Exhibit K
EXHIBIT K
EXAMPLE OF SECTION 9.3 CALCULATION
(Copy attached)
Exhibit K
I-West JV Cash Flows |
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Sample Waterfall |
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| Feb-07 | Feb-07 | Mar-07 | Apr-07 | May-07 | Jun-07 | Jul-07 | Aug-07 | |
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| Total | Year 0 | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 |
JV Structure: |
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MSRE Equity | 80.00% |
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Inland Equity | 20.00% |
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Hurdle | Promote | MSRE % of CF | Inland % of CF |
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Return of Capital | - | 80.0% | 20.0% |
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Hurdle I – 11.00% | - | 80.0% | 20.0% |
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Thereafter | 20.0% | 64.0% | 36.0% |
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Waterfall: |
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Representative Project Levered Cash Flows |
| (225,000,000) | 19,200,000 | 19,200,000 | 19,200,000 | 19,200,000 | 19,200,000 | 327,600,000 | - | ||
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JV Capital Account – ROC: |
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BOP |
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| - | 225,000,000 | 205,800,000 | 186,000,000 | 167,600,000 | 148,200,000 | 129,000,000 | - |
Capital Invested |
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| 225,000,000 | 225,000,000 | - | - | - | - | - | - | - |
Return of Capital |
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| (225,000,000) | - | (19,200,000) | (19,200,000) | (19,200,000) | (19,200,000) | (19,200,000) | (129,000,000) | - |
EOP |
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| 225,000,000 | 205,800,000 | 186,600,000 | 167,400,000 | 148,200,000 | 129,000,000 | - | - |
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CF AFTER ROC |
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| 198,600,000 | - | - | - | - | - | - | 198,600,000 | - |
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MSRE distributions to Hurdle I (11.0%) |
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BOP |
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| - | 180,000,000 | 184,440,400 | 189,368,400 | 194,838,924 | 200,911,206 | 207,651,438 | - |
Capital Invested |
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| 180,000,000 | 180,000,000 | - | - | - | - | - | - | - |
Return of Capital |
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| (180,000,000) | - | (15,360,000) | (15,360,000) | (15,360,000) | (15,360,000) | (15,360,000) | (103,200,000) | - |
Accruals |
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| 127,293,096 | - | 19,800,000 | 20,288,400 | 20,830,524 | 21,432,282 | 22,100,233 | 22,841,658 | - |
Distribution to Hurdle I | (127,293,096) | - | - | - | - | - | - | (127,293,096) | - | ||
EOP |
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| 180,000,000 | 184,440,000 | 189,368,400 | 194,838,924 | 200,911,206 | 207,651,438 | - | - |
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MSRE Distribution under Hurdle I | 127,293,096 | - | - | - | - | - | - | 127,293,096 | - | ||
Inland Distribution | 31,823,274 | - | - | - | - | - | - | 31,823,274 | - | ||
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MSRE CF to Hurdle I | 127,293,096 | (180,000,000) | 15,360,000 | 15,360,000 | 15,360,000 | 15,360,000 | 15,360,000 | 230,493,096 | - | ||
Partner CF to Hurdle I | 31,823,274 | (45,000,000) | 3,840,000 | 3,840,000 | 3,840,000 | 3,840,000 | 3,840,000 | 57,623,274 | - | ||
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Cash Flow Thereafter | 39,483,629 | - | - | - | - | - | - | 39,483,629 | - | ||
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MSRE Share (64.0%) | 25,269,523 | - | - | - | - | - | - | 25,269,523 | - | ||
Partner Share (36.0%) | 14,214,107 | - | - | - | - | - | - | 14,214,107 | - | ||
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I-West JV Cash Flows |
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Sample Waterfall |
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| Feb-07 | Feb-07 | Mar-07 | Apr-07 | May-07 | Jun-07 | Jul-07 | Aug-07 | |
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| Total | Year 0 | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 |
Total Joint Venture Cash Flows: |
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MSRE Cash Flows: |
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Capital Invested | (180,000,000) | (180,000,000) | - | - | - | - | - | - | - | ||
Distributions – ROC | 180,000,000 | - | 15,360,000 | 15,360,000 | 15,360,000 | 15,360,000 | 15,360,000 | 103,200,000 | - | ||
Distributions – Hurdle I | 127,293,096 | - | - | - | - | - | - | 127,293,096 | - | ||
Distributions - Thereafter | 25,269,523 | - | - | - | - | - | - | 25,269,523 | - | ||
Total MSRE Cash Flows | 152,562,619 | (180,000,000) | 15,360,000 | 15,360,000 | 15,360,000 | 15,360,000 | 15,360,000 | 255,762,619 | - | ||
Cumulative MSRE Cash Flows |
| (180,000,000) | (164,640,000) | (149,280,000) | (133,920,000) | (118,560,000) | (103,200,000) | 152,562,619 | 152,562,619 | ||
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MSRE Unlevered IRR | 12.61% |
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MSRE Unlevered CFx | 1.85x |
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Nominal Profit | 152,562,619 |
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Peak Equity | 180,000,000 |
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Inland Cash Flows: |
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Capital Invested | (45,000,000) | (45,000,000) | - | - | - | - | - | - | - | ||
Distributions – ROC | 45,000,000 | - | 3,840,000 | 3,840,000 | 3,840,000 | 3,840,000 | 3,840,000 | 25,800,000 | - | ||
Distributions – Hurdle I | 31,853,274 | - | - | - | - | - | - | 31,853,274 | - | ||
Distributions - Thereafter | 14,214,107 | - | - | - | - | - | - | 14,214,107 | - | ||
Total Inland Cash Flows | 46,037,381 | (45,000,000) | 3,840,000 | 3,840,000 | 3,840,000 | 3,840,000 | 3,840,000 | 71,837,381 | - | ||
Cumulative Inland Cash Flows |
| (45,000,000) | (41,160,000) | (37,320,000) | (33,480,000) | (29,640,000) | (25,800,000) | 46,037,381 | 46,037,381 | ||
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Inland Unlevered IRR | 14.45% |
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Inland Unlevered CFx | 2.02x |
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Nominal Profit | 46,037,381 |
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Peak Equity | 45,000,000 |
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