DS9 Document EFTA01090680

CORE: Income Statement - 2016-2012 Modified Cash Basis (1) (000's) Revenue Forecast 2016 FY 2015 FY 2014 FY 2013 FY 2012 Var 16to'15 %Chg 16 to'15 Var 15 to '14 %Chg 15 to '14 Var 14 to'13 %Chg 14to'13 Var 13 to'12 %Chg 13to'12 New Member Initiation Fees 1.245 1.090 1.330 1.520 1.255 155 14.2% (240) -18.0% (190) -12.5% 265 21.1% New Member Dues 538 496 577 587 526 42 8.5% (81) -14.0% (10) -1.7% 61 11.6% Renewable Dues 5.854 6.008 5.421 5.054 4.839 (154) -2.6% 587 10.8% 367 7.3% 215 4.4% Founding Member Dues 984 631 328 336 314 353 55.9% 303 92.4% (8) -2.4% 23 7.2% Sponsorship/License Fees 702 494 409 620 555 208 42.0% 86 21.0% (212) -34.1% 65 11.8% Food Sales 2.022 2.004 1.864 2.050 2.053 18 0.9% 140 7.5% (126) -9.1% (3) -0.1% Beverage Sales 1.822 1.797 1.761 1.894 1.636 25 1.4% 36 2.0% (133) -7.0% 2E8 15.8% Other F8B Sales 778 816 660 613 483 (38) -4.7% 156 23.7% 47 7.6% 130 26.9% Accommodations Revenue 361 329 336 344 299 32 9.7% (7) -2.0% (8) -2.4% 45 15.2% Wellness Revenue 850 833 1.011 1.062 985 17 2.0% (178) -17.6% (51) -4.8% 77 7.8% Gross Revenue 15.156 14.498 13.697 14.080 12.944 658 4.5% 802 5.9% (383) -2.7% 1.136 8.8% Cost of Sales-Food 608 581 551 652 569 V 4.7% 30 5.4% (101) -15.5% 83 14.6% Cost of Sales-Beverage 395 351 500 477 380 45 12.7% (150) -29.9% 23 4.8% 97 25.6% Cost of Sales-Equipment Rental 290 318 204 200 168 (28) -8.8% 114 55.7% 4 2.1% 32 19.0% Cost of Sales-Suites 250 166 168 172 149 84 50.6% (2) -1.1% (4) -2.4% 23 15.5% Cost of Sales-Wellness 549 529 703 780 733 20 3.8% (174) -24.7% (77) -89% 47 6.4% FM Discounts 8 Allowances 900 885 744 999 823 15 1.7% 141 19.0% (255) -25.6% 176 21.4% Total Cost of Sales 2.992 2.829 2.870 3.280 2.822 163 5.8% (41) -1.4% (410) -12.5% 458 16.2% Gross Profit 12.164 11.669 10.827 10.800 10.122 495 4.2% 842 7.8% V 0.2% 678 6.7% Company Confidential 2/2/2016 Page 1 EFTA01090680 CORE: Income Statement - 2016-2012 Modified Cash Basis (1) (000's) Payroll & Benefits Forecast 2016 FY 2015 FY 2014 FY 2013 FY 2012 Var 16to'15 %Chg 16 to'15 Var 15 to '14 %Chg 15 to '14 Var 14 to'13 %Chg 14to'13 Var 13 to'12 %Chg 13to'12 Payroll-Membership 1.530 1.526 1,433 1,652 1.562 4 0.3% 93 6.5% (219) -133% 100 6.4% Payroll-Food & Beverage 2.196 2.158 2,093 2,053 1.904 38 1.8% 65 3.1% 40 1.9% 149 7.8% Payroll-General & Administrative 775 685 715 745 804 90 13.1% (30) -4.2% (30) -4.0% (59) -7.3% Total Payroll 4,501 4.369 4.241 4.450 4.260 132 3.0% 128 3.0% (209) -4.7% 190 4.5% Operating Expenses Membership 1,131 1,127 989 1.030 952 4 0.4% 138 14.0% (41) -4.0% 78 8.2% Food & Beverage 543 476 463 432 412 67 14.1% 13 2.8% 31 7.2% 20 4.9% General & Administrative 4.275 4249 3.784 3,423 3.317 26 0.6% 465 12.3% 361 10.5% 106 3.2% Accommodations 106 99 58 68 60 7 7.1% 41 70.7% (10) -14.7% 8 13.3% Wellness 333 294 157 138 130 39 13.3% 137 87.3% 19 13.8% 8 6.2% Total Departmental Expenses 6.388 6245 5,451 5,091 4.871 143 2.3% 794 14.6% 360 7.1% 220 4.5% Net Operating Income (EBITO A) 1.275 1.055 1,135 1,259 991 220 20.9% (80) -7.0% (124) -9.9% 268 27.0% Debt Service- Prinicpal (224) (493) (460) (400) (340) 269 54.6% (33) -7.2% (60) -15.0% (60) -17.6% Debt Service- Interest (2) (23) (47) (69) (112) 21 91.3% 24 51.1% 22 31.9% 43 38.4% Sales Tax Audit (20) (36) (36) (50) (28) 11 30.6% 0.0% 14 28.0% (22) -80.5% Capital Expenses (200) (149) (265) (165) (210) (51) -34.2% 116 43.8% (100) -60.6% 45 21.5% Resigned Member Refunds (24) (19) (20) (45) (52) (5) -29.0% 1 7.0% 25 55.1% 8 14.4% Depreciation (1.548) (1,654) (2.064) (2.064) (2.064) 106 6.4% 410 19.9% - 0.0% 0.0% Net Income• (748) (1.319) (1.757) (1.534) (1.815) 571 43.3% 439 25.0% (224) .14.6% 281 15.5% '2016 & 2015 Net Income excludes impact of COD1 (cancellation of debt income) due to restructuring. Company Confidential 2/2/2016 Page 2 EFTA01090681 CORE: Income Statement - 2016-2012 Modified Cash Basis (1) (000's) Forecast FY FY FY FY Var %Chg Var %Chg Var %Chg Var %Chg 2016 2015 2014 2013 2012 16to'15 16 to'15 15 to '14 15 to '14 14 to '13 14 to'13 13 to '12 13 to'12 Key Metrics N of Club Members 1370 1403 1404 1380 1360 N of New Memberships Sold 50 47 59 65 59 Average Initiation Fee per New Membership $ 24.900 $ 23.191 $ 22.542 $ 23.385 S 21.271 Average Annual Dues per New Membership $ 10.760 $ 10.553 $ 9.780 $ 9.031 S 8.915 Membership Retention Rate 90.0% 92.1% 94.1% 91.3% 94.1% Food Cost% 30.1% 29.0% 29.6% 31.8% 27.7% Beverage Cost% 21.7% 19.5% 28.4% 25.2% 23.2% F&B Labor Cost 47.5% 46.7% 48.8% 45.1% 45.6% Total F&B Dining Covers 36.317 36.738 36.247 35.706 37.940 Average FBA Dining Checks S 58.26 $ 57.12 $ 56.56 $ 57.85 S 56.42 Total F&B Event Covers 14.250 14.130 13,956 15,273 16.471 Average Event F&B Checks $ 121.30 $ 120.50 $ 114.19 $ 120.99 S 101.54 Average Non-Dues Spend Per Membership $ 8.974 $ 8.677 $ 8.572 $ 9.633 S 9.017 Company Confidential 2/2/2016 Page 3 EFTA01090682 CORE: Proforma Balance Sheet Post Restructuring as at 12/31/15(a) (S000%) ASSETS Cash $335 Accounts receivable 23 Other current assets 184.3 Current Assets $542 Fixed Assets. Net 7.920 Total Assets MM LIABILITIES & EQUITY Accounts payable & accrued exp. (1) $647 Bank debt - current portion 168 Refundable Initiation Fees Resigned members (2) 5.593 Active Members (3) 7.754 Deferred Revenue 6.406 Deferred Rent 7939 Current Liabilities $21.366 Total Liabilities $21.366 Shareholder Equity ("SE) -12 904 Total Liabilities & SE $8.462 Footnotes; (1) This liability has been reduced by approx $2.5M based on negotiations with RFR and the buyout of their interest (2) This liability is primarily being addressed through services in kind in lieu of cash (3) Represents a contingent liability that is not due until a member resigns Assumptions: a.) The figures presented are before outside accountants review b.) Assumes elimination of FM Notes c.) Assumes elimination of AES Loan and related amounts due RFR d.) Assumes all debt forgiveness flows through as income to the company in 2015 (FM) and 2016 (AES) Company Confidential 2/2/2016 Page 4 EFTA01090683 CORE: Cash Flow for the period ending Dec 31, 2015 (000%) Operating Receipts Cash Receipts - Operations 12.576 Cash Receipts - LC Drawdown 100 Cash Receipts - Other A/R Collections 2.099 Total Receipts 14.775 Operating Disbursements Disbursements to Suppliers (4.983) Disbursements for Payroll (5.607) Disbursements for Benefit Plans (net) (441) Disbursements for Rent (2.428) Disbursements for LC Replenishment (100) Disbursements for Sales Tax (485) Total Operating Disbursements (14.044) Net cash provided by operating activities 731 Less Non-Operating Disbursements Debt Service Prinicpal (493) Debt Service Interest (23) Sales Tax Audit (36) Capital Expenses (1) (149) Resigned Member Refunds (19) Total Non-Operating Disbursements (720) Net Increase/(Decrease) in Cash & Cash Equivalents It Cash & Cash Equivalents at the Beginning of Period 324 Cash & Cash Equivalents at the end of Period (2.3) 335 Footnote% (1) Annual Capital Expense investment will depend on whether club lease is extended or we opt to relocate. Annual capital between $100.200k will be necessary for FF&E improvements (2) 2015 free cash & cash equivalents was $335k Company Confidential 2/2/2016 Page 5 EFTA01090684