Cost to Expand Interest Exp Depreciation Tax Rate NPV Discount Exhibit 5 57 ,817.o 7.75% 7.75% Exhibit 5 1% 300% 3% Exhibit S Flat Flat Calc Flat Units Unit Costs Selling Price New Project Reven u e Production Expenses Raw Materials Manufacturing Overhead Maintenance Expense Labor Expense Selling General and Admin Total Operating Expense EBITDA Depreciatio Interest Expense j Taxes Net Profit Add Depreciation Total Cash Fl 1.77 84,960.00 45,120.00 3,600.00 2,250.00 18,640.00 6,626.88 76,236.88 8,723.12 4,000.00 4,723.12 4,480.82 242.30 96.92 145.38 4,000.00 52000 o.gs$ 1.81 2010 94,120.00 49,400.00 3,708.00 2,317.50 20,233.30 7,341.36 83,000.16 11,119.84 4,000.00 7,119.84 4,480.82 2,639.02 1,055.61 1,583.41 4,000.00 5,583.41 2011 103,040.00 53,760.00 3,819.24 2,38703 22,842.40 8,037.12 90,845.79 12,194.22 4,000.00 8,194.22 4,48082 3,713.40 1,485.36 2,228.04 4,000.00 6,228.04 0.971 2012 112,800.00 58,200.00 3,933.82 2,458.64 25,254.60 8,798.40 98,645.45 14,154.55 4,000.00 10,154.55 4,480.82 5,673.73 2,269.49 3,404.24 4,000.00 -57 ,817 .o)s_ 4,145.38 1.92 2013 122,880.00 62,720.00 4,051.83 2,532.39 28,174.80 9,584.64 107,063.67 15,816.33 4,000.00 11,816.33 4,48082 7,335.51 2,934.21 4,000.00 8,401.31 2014 132,600.00 67,320.00 4,173.39 2,608.37 30,888.50 10,342.80 115,333.05 17,266.95 4,000.00 13,266.95 4,48082 8,786.13 3,514.45 5,271.68 4,000.00 9,271.68 2015 135,320.00 68,000.00 4,298.59 2,686.62 31,969.60 10,554.96 117,509.77 17,810.23 4,000.00 13,810.23 4,48082 9,329.41 3,731.77 5,597.65 4,000.00 9,597.65 1.011 2016 138,040.00 68,680.00 4,427.55 2,767.22 33,088.50 10,767.12 119,730.38 18,309.62 4,000.00 14,309.62 4,480.82 9,828.80 3,931.52 5,897.28 4,000.00 9,897.28 1.02 2017 140,7 sooo 69,360.00 4,560.37 2,850.23 34,246.60 10,979.28 121,996.48 18,763.52 4,000.00 14,763.52 4,480.82 10,282.70 4,113.08 6,169.62 4,000.00 10,169.62 2.12 2018 144,160.00 70,040.00 4,697.18 2,935.74 35,445.20 11,244.48 124,362.60 19,797.40 4,000.00 15,797.40 4,48082 11,316.58 4,526.63 6,789.95 4,000.00 10,789.95 Cost of 10 year contract to customer Base Scenario 5 YR fixed Pricing QI: Tucker is becoming more confident with the numbers in the proposal, but is uneasy about the short-term nature of the contract He is wondering if it might be advantageous to try and renegotiate the contract in an exchange for a longer commitment for the client. His discussion with vou included a fixed price for 5 years followed by a reasonable growth period. He is hoping that some incentive will be enough to get a 5-year commitment. Complete your calculations under the QI tab. You must calculate the new NPV and IRR given your suggested price. You must also include the impact to the customer by calculating the cost of the contract before and after making price changes. Should Hansson accept this, and would you accept this if you were the customer?