Bradley Foundation Construction Debt

This memo summarizes the current status of the Foundation's financing agreements in connection with the acquisition and renovation of the Lion House and Hawley House and presents recommendations as to the merits of repaying the outstanding loan balances.

A summary of the loan agreements is presented below:

Lion House	Hawley House

Total Loan Commitment:	$2,000,000	$2,500,000

Date of Original Agreement:	9/25/95	12/17/98

Total Amount Borrowed:	$1,780,907	$469,506

Outstanding Loan Payable

at June 30, 2000:	$1,162,336	$218,506

Type of Agreement:	Installment	Revolving credit note

note. Monthly	agreement. Monthly

payments of	payments of principal

principal and	and interest with

interest with	balloon payment due on

balloon payment	December 30, 2005.

due on August

25, 2002.

Interest Rate:	Fixed rate 7.5%	Floating -- Prime rate

less 1.25%. Current

prime rate is 9.5%

Prepayment Provisions:	Up to $500,000	None

per year with

no penalty.

The Lion House borrowing has proved beneficial when comparing the 7.5% fixed interest rate on the debt to the double digit returns the Foundation achieved in the past four years. While the year 2000 is off to a slow start with a return of +3.27% for year to date June 30, 2000, achieving at least a total +7.5% for the remainder of the year 2000 appears realistic. Accordingly, no repayment of the note is recommended at this time. It should be noted there would be at least a $5,000 prepayment penalty if the note was paid in advance.

Borrowings for the Hawley House project have been relatively low because of the increasing interest rates that occurred during the past year. The majority of the Hawley House construction costs were paid for in cash. Given the note payable's current interest rate of 8.25% (up 1% since January, 2000), the potential for increasing interest rates and the relatively low outstanding loan balance, it is recommended that the remaining $218,506 be repaid immediately. There is no prepayment penalty applicable to this loan agreement.