please show all detailed calcualtions, show formulas mathematically instead of excel functions

Consider the loan offer in file "Mortgage Example". Prepare a pro-forma statement for the first year following the start of the mortgage. Assume the net operating income for the first year is zero. Focus on the financing part of the pro-forma, no need to list or fill the income or tax part of the pro-forma. Focus on the following questions: 1. How should you include the "lender fee" described in the mortgage offer? 2. How should you include the interest reserve account? 3. Imagine the property is sold at the end of the first year for $6,000,000, net of sales and legal expenses. Prepare the pro-forma statement at the time of sale. Include the repayment of the mortgage. Do not include the tax part of the pro-forma as we have not covered that yet. We are prepared to offer to you a first mortgage on the following terms and conditions; 1. Borrower: 2. Mortgage Amount: $4,000,000 - to be registered as a first mortgage. 3. Term of Mortgage: Is 18 months 4. Advances: As needed and agreed upon. Annually 5. Interest Rate: 8.5% calculated hionthly not in advance. Interest payments to be made by post dated cheques. 6. Guarantor \& Administration fee will be 8% of the total mortgage amount. payable at the time of funding. 6. a) Prepayment Privileges: The loan can be repaid in full or part after 3 months and on 30 days written notice. 7. Interest Adjustment Date: As soon as monies can be advanced, and will be adjusted monthly. 8. Security: A valid registered first charge on the following subject property legally described as 9. Additional Security: A) General Security agreement from the borrower B) Assignment of rents, leases, purchase and sale contracts, contracts, development plan, building and development permits. 10. Subject Conditions: 1) 2) All subordinated mortgagees, and the general partner will provide the lenders with a "stand still" agreement prior to any advances on the mortgage. 3) All draws after the first one shall be subject to an as needed basis, based upon an agreed upon budget, where such evaluations have been confirmed by Consultants and where shall ensure there is at all time, sufficient funds to complete the project. 4) Receipt and satisfactory review of a current appraisal report on the subject property confirming the current value of the subject property. The lender is to be provided with a letter of transmittal from the appraiser confirming that it can rely on the appraisal. 5) Borrower to provide Lender with confirmation of all governmental approvals, drawings, and other material required to confirm the development viability of the project. This is to include a draft form of a turnkey servicing contract with a licensed and bondable servicing Contractor and Engineering firm. Prior to funding, there will need to be a fully executed contract to the satisfaction of the Lender. 11. Prepayment: the lender will provide partial discharges to allow for the conveyance of all building lots that are sold, providing that all monies received from such sale is applied against the mortgage. In addition the borrower will pay the cost of discharges and the cost of discharging the mortgage on payout. 12. Fees and Costs: All legal fees, costs and disbursements incurred in the processing of this mortgage loan will be at the expense of the borrower. Their fees and costs will be deducted from the mortgage proceeds. 13. Taxes: All assessed taxes must be paid prior to funds being advanced. 14. Legal: The legal work will be done by the lenders lawyer. The lenders is : (lenders lawyer information to be inserted) The borrowers lawyer is: 15. Assumption: This commitment letter is not assignable, nor is the mortgage assumable 16. Non Merger Clause: Neither the execution or registration of the mortgage, or advance of the loan or any part thereof, will relieve the borrower of any obligation or condition contained herein. 17. Payout: Any payment received after 12:00 noon constitutes interest costs accruing to the following business day. All reasonable costs in connection with this transaction, whether or not it is proceeded with are for the borrowers account, including, but not limited to, appraisal fees, legal fees and disbursements. 18. If any existing old accounts are to be paid from the proceeds of this mortgage, they must be disclosed and agreed upon prior to any mortgage funding. This mortgage is intended to provide funds to assist in servicing the project with power, water, gas and roads, and can not be used for any other purpose other than repayment of existing mortgage. 19. if this mortgage or any part of it goes into default the interest rate will increase to 18% per annum effective when the default occurs. The borrower agrees to execute all other documents as are reasonably required to arrange for the security for the mortgage loan. A $340,000.00 interest reserve will be established to cover the monthly mortgage payments for this loan. 3/4 of the monthly payment will come from the interest reserve and the balance is to come directly from the Borrower. Interest will not be charged on the interest reserve (which will be withheld from the mortgage advances but interest will be charged on monies advanced monthly to help make the monthly interest payment). Facsimile and email signatures will be acceptable for the purposes of this agreement. 20. Additional Lender lawyer conditions: This agreement may be subject to other clauses as recommended by our legal counsel. If the terms an conditions are acceptable to you, please sign the original of this letter and return to us by Yours very truly