Page 81 - Microsoft Word - Hot Shots CIM Version 1.9.2 Final

EXIT OPTIONS

Two major developments underpin the vision for the business. These are firstly, the Club
Corp entry to the golf centre business, as an investor in BigShots USA funded by Apollo
and planning up to 100 Centres across the USA and secondly, Top Golf deciding to build
new centres in the UK.

That interest is shared in many other countries across the world. Thus the possibilities
of Club Corp or similar institutions to Apollo investing in Hot Shots with its strong
cashflow has to be considered as an exit. Similarly so for a national UK sports retailer
following the approach that has been made.

In addition, there are two exit routes for the first investors in the Hot Shots business.

First, surplus cash will be applied towards paying down debt, given the expected surplus
In 5 years with 5 Centres built or underway, further development might be halted and
surplus cash begin to be applied to pay down equity to a point where the remaining equity
can be refinanced with long term institutional index linked debt.

Second, the 5 Centres to be built are planned to have an EBITDA in excess of £15m on
stabilisation. In the hospitality and leisure sectors, where business values are 12 to 14 x
EBITDA, a business value in excess of £180m is possible. Target buyers would be
operating groups or investors in the sector, which wish to add a strong income stream
and relatively straightforward business to their portfolio.

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