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4 <br /> FACILITIES <br /> The 90, 000 sq. ft. facility will include a 180 'x 75 ' pool, a 200 'x <br /> 85 ' Ice Rink, a fitness center, a multipurpose activity center, a <br /> community sports shop, a snack bar as well a range of offices changing <br /> rooms reception area etc. The main contractor is McDevitt Street Bovis <br /> who have also contracted to build a number of the sporting facilities <br /> in Atlanta for the 1998 Olympic Games. Cimco Lock Refridgeration, the <br /> Subcontractor for the Ice Rink, is the major company specializing in <br /> this field in Canada and USA. <br /> MANAGEMENT <br /> The TYHA has brought together an impressive management team which <br /> includes a combination of professional, semi-professional and volunteer <br /> coaches and helpers. They have also built a team of professional <br /> advisors to support their Board of Directors. <br /> FINANCIAL INFORMATION <br /> TYHA will need to finance $6.7 million. Detailed projections of <br /> revenues and expenses over the 10 year life of the required loan have <br /> been made to support the viability of the project. A model has been <br /> designed to allow the effects of varying rates of inflation in both <br /> revenue and expenses to be tested. A matrix of financing costs has also <br /> been designed to cover borrowing between $6.7 and $7 million and fixed <br /> rates from 5. 5% to 10%. Based on an informal survey of leading Banks in <br /> the region a rate of 9% fixed has been shown in the projection. <br /> Typically for a Project Finance concept, evaluation of the proposal <br /> has been based on the two major income streams (Rink and Pool revenues) <br /> plus the extent to which county funds can be guaranteed over the <br /> lifetime of the loan. A county guarantee to make monthly payments <br /> equivalent to $400, 000 a year for 10 years is sufficient to validate <br /> the cash flow and should make the deal "bankable" . Less emphasis is <br /> placed on the nature and value of underlying asset that the money will <br /> be used to build although it is relevant that if, for any reason, the <br /> facility could not pay its way in its intended usage, there would still <br /> be a 90, 000 sq.ft building on 16. 8 commercial acres in a well located <br /> business park. A lender would certainly take such evaluation into <br /> reckoning as well as the benefit of the main contractor' s performance <br /> bond during the construction stage. <br /> The projection makes the very conservative assumption that cumula- <br /> tive revenue increases would be kept to 1% (year on year) whilst costs <br /> would rise at a rate of 4% (year on year) . <br /> • <br />