RGI Collateral 3-29

Berwick Academy, founded in 1791, is a Pre-kindergarten through Post-graduate college-preparatory

day school dedicated to promoting virtue and useful knowledge among the rising generations. As one school with three divisions, Berwick develops balanced lead-ers through personal relationships that foster confidence and achievement. By engaging in a program distinguished by academic challenge, creative expression and performance, innovative technology, ethical sportsmanship, wellness, and a commitment to the common good, Berwick graduates become resilient citizens by living our core values of balance, engagement, excellence, and integrity.

Berwick Academy Mission

[Welcome Letter Outline]

We have a transformational, capitally efficient plan that will make dramatic improvement at Berwick:

Over the past two years, we have developed a plan that will allow Berwick to become:• More financially sustainable• More accessible to families from a variety of financial circumstances• Better positioned to support dedicated teachers• More attractive to potential applicants

“The academics at Berwick Academy have made me a more refined person who can structure and organize complex ideas, and with those ideas realize more about my world. Because of this, I am a confident, curious person who is always seeking new knowledge, and that knowledge makes a smarter, happier world.”

- Eric Rawn ‘16

BERWICK ACADEMYFY 2013 -‐ 2017

LONG RANGE BUDGET PLANNING FINANCIAL MODELSummary Details

Summary Model 4.xlsx Version 4

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017Scenario I (Improvements without Fundraising)

Incremental Annual Fund Increase 100,000$ -$ -$ -$ -$ 5% Incremental Salary Pool Increase 314,628$ 314,869$ 287,829$ 333,826$ 349,636$

Incremental Campus Investment 150,000$ 150,000$ 100,000$ 100,000$ 100,000$ Unrestricted Draw 433,889$ 463,889$ 395,000$ 590,000$ 660,000$ Debt Service details Interest only Interest only P&I (half year) P&I P&ITotal Cash & Investments @ June 30 14,615,193$ 14,417,565$ 14,269,769$ 13,921,552$ 13,485,741$

Marketable Investments - Beginning Balance 14,650,000$ 14,515,193$ 14,317,565$ 14,169,769$ 13,821,552$ less draw (unrestricted & restricted) (689,032)$ (744,642)$ (681,756)$ (883,179)$ (960,051)$ add operating OPEX surplus 9,245$ 7,049$ 1,346$ 7,847$ 10,078$

3.72% add investment return 544,980$ 539,965$ 532,613$ 527,115$ 514,162$ Ending Balance 14,515,193$ 14,317,565$ 14,169,769$ 13,821,552$ 13,385,741$

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017Scenario II (Treading Water)


Incremental Campus Investment -$ -$ -$ -$ -$ Unrestricted Draw 283,889$ 283,889$ 200,000$ 150,000$ 90,000$ Debt Service details Interest only Interest only P&I (half year) P&I P&ITotal Cash & Investments @ June 30 14,765,193$ 14,865,686$ 15,075,008$ 15,204,006$ 15,378,162$



FY 2013 FY 2014 FY 2015 FY 2016 FY 2017Scenario III (Improvements with Fundraising)

Incremental Annual Fund Increase 600,000$ 500,000$ 500,000$ 500,000$ 500,000$ 5% Incremental Salary Pool Increase 314,628$ 314,869$ 287,829$ 333,826$ 349,636$

Incremental Campus Investment 150,000$ 150,000$ 100,000$ 100,000$ 100,000$ Unrestricted Draw -$ -$ -$ -$ -$ Debt Service details Interest only Interest only P&I (half year) P&I P&ITotal Cash & Investments @ June 30 14,865,193$ 14,965,686$ 15,175,008$ 15,304,006$ 17,117,226$

Marketable Investments - Beginning Balance 14,650,000$ 15,089,908$ 15,490,618$ 15,965,461$ 16,518,468$ less draw (restricted only) (255,143)$ (280,753)$ (286,756)$ (290,179)$ (300,051)$ add operating OPEX surplus 75,356$ 43,160$ 106,346$ 167,847$ 100,078$


$2.5 Million Impact of the Rising Generations Initiative

$12,800,000

$13,000,000

$13,200,000

$13,400,000

$13,600,000

$13,800,000

$14,000,000

$14,200,000

$14,400,000

$14,600,000

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Marketable Investments -‐ Model I

Current Financial Model

Investing in Operational ExcellenceThe Case for Financial Durability

Proposed Financial Model

BERWICK ACADEMYFY 2013 -‐ 2017

LONG RANGE BUDGET PLANNING FINANCIAL MODELSummary Details

Summary Model 4.xlsx Version 4

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017Scenario I (Improvements without Fundraising)


Incremental Campus Investment 150,000$ 150,000$ 100,000$ 100,000$ 100,000$ Unrestricted Draw 433,889$ 463,889$ 395,000$ 590,000$ 660,000$ Debt Service details Interest only Interest only P&I (half year) P&I P&ITotal Cash & Investments @ June 30 14,615,193$ 14,417,565$ 14,269,769$ 13,921,552$ 13,485,741$



FY 2013 FY 2014 FY 2015 FY 2016 FY 2017Scenario II (Treading Water)


Incremental Campus Investment -$ -$ -$ -$ -$ Unrestricted Draw 283,889$ 283,889$ 200,000$ 150,000$ 90,000$ Debt Service details Interest only Interest only P&I (half year) P&I P&ITotal Cash & Investments @ June 30 14,765,193$ 14,865,686$ 15,075,008$ 15,204,006$ 15,378,162$



FY 2013 FY 2014 FY 2015 FY 2016 FY 2017Scenario III (Improvements with Fundraising)

Incremental Annual Fund Increase 600,000$ 500,000$ 500,000$ 500,000$ 500,000$ 5% Incremental Salary Pool Increase 314,628$ 314,869$ 287,829$ 333,826$ 349,636$

Incremental Campus Investment 150,000$ 150,000$ 100,000$ 100,000$ 100,000$ Unrestricted Draw -$ -$ -$ -$ -$ Debt Service details Interest only Interest only P&I (half year) P&I P&ITotal Cash & Investments @ June 30 14,865,193$ 14,965,686$ 15,175,008$ 15,304,006$ 17,117,226$

Marketable Investments - Beginning Balance 14,650,000$ 15,089,908$ 15,490,618$ 15,965,461$ 16,518,468$ less draw (restricted only) (255,143)$ (280,753)$ (286,756)$ (290,179)$ (300,051)$ add operating OPEX surplus 75,356$ 43,160$ 106,346$ 167,847$ 100,078$


$2.5 Million Impact of the Rising Generations Initiative

$14,000,000

$14,500,000

$15,000,000

$15,500,000

$16,000,000

$16,500,000

$17,000,000

$17,500,000

FY 2013 FY 2014 FY 2015 FY 2016 FY 2017

Marketable Investments -‐ Model III

Berwick Academy’s greatest strength is the relationships forged between students and teachers, and the vast majority of our teachers are exceptional. However, faculty demographics suggest that significant numbers of teachers will retire in the next ten years. In the past, we have relied on tuition remission and geography to drive hiring success in the local area. Going for-ward, these tools will not be sufficient to elevate the level of our faculty on a national level. Consequently, we will improve salary levels and benefit programs to the mean levels of our benchmark group. Competitive salary and benefits will ensure our ability to attract and retain the best talent from across the country for our students. Continued emphasis on evaluations, professional development, and making diversity a priority in hiring will complement our increased level of investment in faculty compensation.

Investing in Our Most Important AssetThe Case for Faculty Compensation

“The faculty at Berwick has had an amazing impact on my experience during my three years here. My art teacher, Mrs. Wildnauer, in particular, has been a wonderful mentor and teacher, and I value my relationship with her immensely. This relationship with Mrs. Wildnauer along with my other teachers, has been an incredibly positive influence on my academic, social, and artistic life here at BA.”

- Abby Scanlon ‘12

Each year, over $2.6 million dollars out of our $13.5 million operating budget goes towards supporting the best students in the Seacoast regardless of their ability to pay tuition. Increasing support for financial aid will also be essential in meeting the various student diversity goals we have as well. The budget for this is financed primarily from unrestricted funds and tuition discounting. Financial aid is a vital tool for us to be able to maintain and improve the quality of our student body.

Investing in the Best and BrightestThe Case for Financial Aid

“Without financial aid, I would not have been able to attend Berwick and receive such

a high quality education. Today, this generosity continues to inspire me as I advocate for the

educational rights of students with disabilities and happily represent pro bono clients.”

- Lillian Glidden Wong ‘01

The campus is one of our greatest assets. While it presently serves our faculty and student body well, a number of improvements will be required and undertaken over the next ten years. We will construct a modern Performing Arts Center that will accommodate a desired high school enrollment of 325-375 and meet the needs of our sophisticated Arts program. When the Upper School does grow, we will renovate the inside of Fogg and/or re-purpose some of our existing spaces across campus. We know that the needs of our Office of Advancement will continue to expand, and we will renovate Oakes House to address Advancement space requirements and/or the future of our employee day care. Finally, the curb appeal of our beautiful campus trails our competitors, and we want to build our image as a source of pride to the local community. Therefore, we will complete the master landscaping plan that has been put in place for the major entrances of the school. The impact of these changes cannot be overstated from an enrollment and community morale perspective.

$25,000-$50,000 $50,000

$100,000-$200,000

Investing in Our FacilityThe Case for Campus Enhancements

Perrault bequest $ 3.8 MM

III Century Campaign GOAL: $5M

Math & Science Center

GOAL: $6M

Campaign for Academic Excellence

GOAL: $15M AF: 2020

GOAL: $3M

$-‐

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

Investments -‐ Historical & Projected

Historical and Projected Investment Data

The Academy cherishes its 220 year history of serving the Seacoast as a public town academy (until 1960), a boarding school (approximately 1960-1975), and now in its present form as a PK – 12 country day school. The period from 1990-2007 was characterized by truly extraordinary enhancements to our physical plant as well as meaningful endowment growth. Facil-ity additions included the Athletic Center, Jeppesen Science Center, Clement Middle School, and the Jackson Library. During this period, the School also began to build its endowment and investments from virtually nothing in the early 1990’s to a net endowment (endowment minus debt) of nearly $8 million (gross endowment approximately $20 million) by 2006. There is no question that students at Berwick today are the extraordinary beneficiaries of these courageous investments and improvements

While these enhancements revolutionized the campus in the near term, they did require the Academy to secure nearly $12 million of debt to bridge the construction. Since taking on these notes, our debt service costs had grown to represent a significant drain on the operating budget with principal and interest costs reaching their zenith of $1.05MM during the 2009-2010 fiscal year (nearly 10% of our operating budget at the time). In order to meet these emerging principle and interest costs, the School began drawing heavily from its newly secured endowment. Combined with negative market re-turns, this began a pattern of eroding principle, beginning a trend of devaluing the financial strength of the Academy in the long term. The strategy of debt acquisition and construction served Berwick incredibly well during the past decade, but the market realities of the past few years have made this a difficult strategy to sustain. It is fair to say that in our current model, we are depleting vital investment resources that ensure the high caliber of Berwick’s faculty and programs at the expense of future generations.

$16,907,620 includes

refinance and debt paydown

of $ 3M

Five Year Plan 2013 – 2017

Annual Fund $3,750,000

Rising Generations Initiative $2,500,000

Total $6,250,000

Scale of Gifts for Rising Generations Initiative

Number of Gifts Amount Totaling 3 $250,000 $750,000 8 $100,000 $800,000 14 $50,000 $700,000

Many <$50,000 $250,000 $2,500,000

How Can You Help?

Text

Five Year Plan 2013 – 2017

Annual Fund $3,750,000

Rising Generations Initiative $2,500,000

Total $6,250,000

Mr. and Mrs. John Smith

Annual Fund $20,000 x 5 $100,000

Rising Generations Initiative $30,000 x 5 $150,000

Total $50,000 x 5 $250,000

Annual Contribution Years Accumulated Contribution

[INSERT in back pocket]

In support of the Rising Generations Initiative, this confirms my pledge to invest $_________ in Berwick Academy to the Annual Fund

Donor(s)_______________________________________________________________________

I/We pledge to fulfill this commitment according to the following schedule: (Please circle one and indicate dates and amounts below)

Pledge to be paid over 1 2 3 4 5 year(s)

___________, 2012 $ ___________ ___________, 2013 $ ___________ ___________, 2014 $ ___________ ___________, 2015 $ ___________ ___________, 2016 $ ___________

Payment Details: Please send reminder notices as installments become due: Yes___ No___ Preferred listing of name(s):_____________________________________________________________________ OR list as Anonymous ____

We plan to make our gift by: check___ credit card ___ stock___ other___

Please make checks payable to: Berwick Academy Rising Generations Initiative Please circle credit card type: (VISA MC AMEX) #_________________________________________Exp.Date_______CIC______ Signature(s)______________________________________________________________Date________ The Board of Trustees of Berwick Academy is very grateful for your pledge of support to the Rising Generations Initiative. Your commitment will help strengthen the Academy and improve the educational opportunities for talented students throughout the Seacoast. Thank you for investing in our future.

[INSERT in back pocket]

RGI Collateral 3-29

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Transcript of RGI Collateral 3-29