PROJ00404 ‎(2)‎

• Contract/PO #: C150091
• Contractor Name: Silver Springs Trout Farm, Inc. & Daniel A. & Jacqueline P. Sherwood Trust
• Contract Type: Loan
• Water District: 41
• County: Mesa
• Bill Number: HB 02-1152
• Loan Projects - Doc Type: Approval Letter

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Silver Springs Trout Farm I Sherwood Trust Agenda Item 22a.
November 19-20, 2001 (Updated November 26,2001)

Credit worthiness: The SSTF / ST has an existing private loan with Ray Thompson of
Glenwood Springs, Colorado. The outstanding balance of this loan is $344,010. Loan approval
will be subject to an acceptable credit report from this lender. Table 3 shows the Financial
Ratios for the SSTF / ST and indicates two ratios in the strong category and one in the weak
category with the $365K CWCS loan in piace., Company income has been improving from year
to year since the hatchery has been placed back in operation.

Table 3. Financial Ratios- Silver Springs Trout Farm

Financial Ratio Without With
The proiect The proiect
Operating Ratio (revenue/expense) 140% 170%
weak: less than 100% (strong) (strong)
average: 100% - 120%
strana: areaterthan 120%
Debit Service Coverage Ratio 149% 268%
(revenues-expenses)/debt service (strong) (strong)
weak: less than 100%
average: 100% - 125%
strona: areaterthan 125%
Cash Reserves to Current Expense 59% 35%
weak: less than 50% (average) (weak)
average: 50% - 100%
strona: areater than 100%
Annual Cost per Acre-Foot N/A N/A
weak: greater than $20
average: $10 - $20
strona: less than $10

As security for the loan the SSTF / ST will pledge a first interest In real estate of value at least
equal to the loan amount. This security is in compliance with CWCS Loan Policy #5 (Collateral).

Recommendation
Staff recommends a CWCS loan in amount of $365,000 (for up to 90% of total project costs) to
the Silver Springs Trout Farm Inc. / Daniel A. and Jacqueline P. Sherwood Trust to rehabilitate
the Silver Springs Trout Farm hatchery and to refinance debt associated with rehabilitation work
aiready completed. The recommended term of the loan is 15 years and the recommended
lending rate is II Security for the loan will be a first interest in real estate and water rights of
value at least equal to the loan amount. The loan will be funded from the Construction Fund.

Staff further recommends that final approval of the loan be conditioned upon all other standard
contracting provisions of the CWCS.

Action taken by the CWCS November 20, 2001
The CWCS approved the Staff Recommendation, with the exception of the interest rate, which
was set at 2.5%. The CWCS also required the collateral be sufficient to cover the loan amount,
in the event the hatchery was to test positive for whirling disease.

cc: Dan Sherwood, 13221 Marine Road, Montrose, CO 81401
Ed Frazar via em ail
Linda Bassi, AGO

Attachment

C:\WP51 \Proj-New\Sherwood-SilverSprings11 01 memo:

L:\boardmem\Nov01\22a Nov 01 Sherwood

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