I need to the return for the lender based ont eh following deal structure.

Is it exceed 18% IRR?

Structure Senior Subordinated Note / Second Lien

Commitment Amount $20,000,000

Minimum Initial Draw $5,000,000

Future Draws Minimum of $2,500,000 increments, subject to pro forma leverage

test

Maturity Five years from close

Coupon 13.0% cash, 2.0% PIK

Warrants 2.5%, issued in full upon drawing the first $5.0 million tranche

Amortization Bullet at maturity

Prepayment Penalty 4.0% in Year 1, 2.0% in Year 2, and 1.0% in Year 3

Fees 2.5% (1.0% commitment fee and 1.5% drawdown fee

12/31/2003 2003 26 87,653 12,776 12/31/2004 2004 38 130,338 19,980 12/31/2005 2005 50 183,492 29,388 12/31/2006 2006 62 233,892 38,837 Corp G&A EBITDA 7,202 5,574 9,384 10,596 12,844 16,544 16,372 22,465 Pre Open Exp EBITDA--POE 2,458 3,116 2,541 8,055 3,013 13,531 2,946 19,519 EBIT 274 2,706 5,026 8,657 SKM Mgmt Fee EBIT--Aft Mgmt Fee 152 122 150 2,556 150 4,876 150 8,507 Int Exp--Sr Debt Int Exp--Mezz 407 - 821 2,625 815 3,053 988 3,114 407 (285) 3,446 (890) 3,868 1,008 4,102 4,405 3,371 3,670 251 9.0% 7.4% 3,772 246 9.6% 8.3% Projections--Mgmt Stores--EOP Revenue Store $F Total Int Exp EBT Rev/Store Pre Open/New Store EBITDA(Pre)/Rev EBITDA(Post)/Rev Balance Sheet Sr Debt 6.4% 3.6% 3,430 212 8.1% 6.2% 18,640 14,503 25,386 33,939 Mezz Debt Total Debt 17,500 36,140 20,350 34,853 20,757 46,143 21,172 55,111 2003 26 87,653 12,776 2004 38 128,747 19,228 2005 50 178,751 26,945 2006 62 228,793 35,333 Corp G&A EBITDA 7,202 5,574 10,300 8,928 14,300 12,645 18,303 17,030 Pre Open Exp EBITDA--POE 2,458 3,116 2,541 6,387 3,013 9,632 2,946 14,084 Projections--Base Stores--EOP Revenue Store $F EBIT 274 1,038 1,127 3,222 SKM Mgmt Fee EBIT--Aft Mgmt Fee 152 122 150 888 150 977 150 3,072 Int Exp--Sr Debt Int Exp--Mezz 407 - 821 2,625 855 3,053 1,091 3,114 407 (285) 3,446 (2,558) 3,908 (2,931) 4,205 (1,133) Total Int Exp EBT Rev/Store Pre Open/New Store Balance Sheet Sr Debt 3,371 3,388 212 3,575 251 3,690 246 18,640 14,503 29,030 41,184 Mezz Debt Total Debt 17,500 36140 20,350 34,853 20,757 49,787 21,172 62,356 17,500 2,275 20,350 2,646 20,757 2,698 350 2,625 407 3,053 415 3,114 2,500 20,350 20,757 21,172 Allied Note Balance Bal--BOP 13% Cash Int 2% PIK Int Total Int Period Drawdown Bal--EOP 17,500 17,500 12/31/2007 2007 67 269,592 44,673 12/31/2008 2008 72 290,592 48,596 18,871 25,802 1,250 24,552 Valuation at YE 2002 Rev 52,098 Store EBITDA 7,600 G&A 4,573 SKM Investment Investment Shares Purch PX 20,341 28,255 EBITDA-POE Pre $ Sh 1,250 27,005 Mult EV 11.6x 35,113 13,848 16,301 Debt Equity Value 1,588 33,525 150 13,698 150 16,151 1,015 3,176 792 3,239 4,191 9,507 4,031 12,120 4,024 250 9.6% 9.1% 4,036 250 9.7% 9.3% 27,181 18,609 21,596 48,777 22,027 40,636 2007 67 264,493 41,019 2008 72 285,493 44,943 21,159 19,860 22,839 22,104 1,250 18,610 1,250 20,854 Per Sh 3,027 2.91 Pre$ Val Post $ Val 7,906 10,150 150 7,756 150 10,000 1,189 3,176 1,042 3,239 4,365 3,391 4,281 5,719 3,948 250 3,965 250 38,300 33,785 21,596 59,896 22,027 55,812 21,172 2,752 21,596 2,807 423 3,176 432 3,239 21,596 22,027 Ex12B in case has Sub Note on BS but no related Int Exp This if PF for adding Sub Note Int Expense KM Investment 15,500,000 6,192,411 2.50 5,323,812 13,325,841 28,825,841 Shareholdings Nancrow SKM Other Mgmt Other Total 2,879,056 6,192,411 1,704,401 740,355 11,516,223 25.0% 53.8% 14.8% 6.4% 100.0% Note: From FN 8 P7 but doesn't reconcile with B 7 but doesn't reconcile with BS outstandings