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KEVIN P. CATTOOR <br />FINANCIAL COMMUNICATIONS CONSULTANT <br />2224 73rd COURT NORTH <br />MINNEAPOLIS, MN ,& 4"4 <br />But. (612)-370-0688 <br />Rev.(612)-566.5294 <br />TO: MEMBERS OF THE LAKE MINNETONKA <br />CABLE COMMUNICATIONS COMMISSION, <br />FROM: Kevin P. Cattoor(.'.- <br />DATE: November 26, 1986 <br />RE: Financial Analysis of Dowden Cable Partners, L.P. <br />Memb`rs of the Lake Minnetonka Cable Communications <br />Commission ("Commission") have requested through its legal <br />counsel, Mr. Mark Ayotte, of the O'Connor_ & Hannan law firm, <br />a financial analysis of the proposed transaction which would <br />result in the sale of the Dowden Communications Inc. ("DCI") <br />cablesystems to Dowden Cable Partners, L.P. ("Dowden Partners"). <br />The purpose of the financial analysis is to give the Commission <br />comfort as it relates to the Dowden Partners' forecasted financial <br />condition compared with that of DCI. In performing the financial <br />analysis, the Dowden Partners' offering document submitted to <br />the Commission was reviewed. For purposes of the analysis, <br />primary emphasis was placed on Exhibit 1 (Financial Forecast), <br />Exhibit 5 (Pro Formq Balance Sheet of Dowden Partners) and Exhibit <br />6 (Financial Statements of DCI). In assessing the financial <br />condition of Dowden Partners, the following criteria were <br />addressed: <br />1. How does the Dowden Partners' pro forma balance sheet <br />compare with the DCI unaudited balance sheet dated December 1, <br />1986? <br />2. Do the forecasted operating results of Dowden Partners <br />appear reasonable and provide for potential return on investment? <br />3. Is the market value of the DCI systems affected as <br />a result of the Dowden Partners' transaction? <br />The above three criteria are discussed in this memorandum. <br />As a result of this review a conclusion will be reached as to <br />whether the financial condition rf Dowden Partners is equivalent <br />to that of DCI. <br />I. BALANCE SHEET ANALYSIS <br />Included in the offering document as Exhibit 5 is a pro <br />forma balance sheet which documents the projected financial <br />condition of Dowden Partners subsequent to the transaction <br />documented to take place on December 1, 1,986. The purpose of <br />this pro forma balance sheet is to document the adjustment <br />required to the DCI balance she-t as a result of the proposed <br />transaction. <br />