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I I I I I I I I I I I I I I I I I I I Table 9-1. Financial Summary Project Cost $205,000.00 Loan Amount (93% of Project Cost) $190,000.00 CWCB Loan Payment Amount, including 10% loan reserve (First 10 Yrs) $9,985.52 Number of Shareholders 27 Number of Shares of Stock 831//8 Current Assessment per Share $215 Future Assessment per Share $228 Annual Project Cost per acre-foot $12.59 (Average annual average (10 years) diversions: 15,339 acre-feet) Since the Company has sufficient cash on hand to fund the difference between the loan and project cost, there will be no additional debt service on this project. Operation and maintenance costs are expected to decrease with the improved dam outlet works and can be accommodated by the Company's existing budget. 9.1 Credit worthiness Terrace Irrigation Company has outstanding debts totaling $1,887,209. Following is a tabulation of the outstanding loans as of October 31, 2003: Colorado Water Conservation Board - Dam outlet repair Colorado Water Conservation Board - Ditch lining Farmers Home Administration Total $361,835 $1,499,395 $25,979 $1,887,209 Utilizing data from the profit & loss statement and balance sheet included in Appendix D, Table 9-1 shows the Financial Ratios for The Terrace Irrigation Company and indicates at least average ability to repay existing and requested company loans. Further, their cash reserves are substantial. Table 9.1-1. Financial Ratios Financial Ratio* Without the pro.iect With the project Operating Ratio (revenue/expense) 95% 100% Debit Service Coverage Ratio 92% 100% (revenues-expenses)/debt service Cash Reserves to Current Expense 263% 240% Annual Cost per acre-foot $11.96 $12.59 (10 year average diverted 15,339 ac-ft) * Calculations deriving ratios are included in Appendix E. Terrace Irrigation Company Outlet Works Feasibility Study February 2004 Page 9 of 10