Your emplorer is considering undertaking a leveraged buyout of a snack-foods company. Another analyst in your group has created the following projections for the company. Your director has asked you to determine the amount of debt that will be outstanding at the end of 2028, which is when your employer expects to hold an IPO for the company. The LBO will be finananced using two forms of debt: $1.4 million in investment grade debenture bonds with a coupon rate of 5.4%, maturing in 2033, and a $2.7 million term loan with a fixed rate of 7.5% per year. The term loan balance will be paid down each year with all free cash flow generated by the company. You should assume that the company will pay a 35% tax rate and have no changes in NWC throughout the life of the deal.

\begin{tabular}{|c|c|c|c|c|c|c|} \hline & & & Yea & & & \\ \hline & & 1 & 2 & 3 & 4 & 5 \\ \hline & 2023 Actual & 2024E & 2025E & 2026E & 2027E & 2028E \\ \hline Forecasted Income Statemen & & & & & & \\ \hline Net Revenues & 5,456,247 & 5,838,184 & 6,246,857 & 6,684,137 & 7,152,027 & 7,652,669 \\ \hline Cost of Services (Ex Depreciation) & 4,942,247 & 5,020,838 & 5,372,297 & 5,748,358 & 6,150,743 & 6,581,295 \\ \hline EBITDA & 514,000 & 817,346 & 874,560 & 935,779 & 1,001,284 & 1,071,374 \\ \hline Depreciation & & 29,191 & 31,234 & 33,421 & 35,760 & 38,263 \\ \hline Amortization & & 0 & 0 & 0 & 0 & 0 \\ \hline EBIT & & 788,155 & 843,326 & 902,359 & 965,524 & 1,033,110 \\ \hline Interest Expense & & & & & & \\ \hline Term Loan & 7.50% & & & & & \\ \hline Investment Grade Bonds & 5.40% & & & & & \\ \hline EBT & & & & & & \\ \hline Provision for Income Taxes & 35% & & & & & \\ \hline Net Earnings & & & & & & \\ \hline Plus Depreciation & & & & & & \\ \hline Minus CapEx & & 35,029 & 24,987 & 40,105 & 37,191 & 45,916 \\ \hline Minus Change NWC & & - & - & - & - & - \\ \hline Free Cash Flows & & & & & & \\ \hline Term Loan Repayment & & & & & & \\ \hline & & & & & & \\ \hline Balance Sheet & & & & & & \\ \hline Long-Term Debt & & & & & & \\ \hline Term Loan & 2,700,000 & & & & & \\ \hline Investment Grade Bonds & 1,400,000 & & & & & \\ \hline Total Long-Term Debt & 4,100,000 & & & & & \\ \hline \end{tabular}