Inka Terra, Peru S.A.C.

completed

1 Inka Terra S.A.C Cusco Amazonico is a Peruvian hotel operator that specializes in properties oriented towards eco-tourism. The Company presently owns and operates two properties: the 85-room Machu Picchu Pueblo Hotel (MPPH), which is located in the town of Aguas Calientes near the ruins of Machu Picchu, and the 43-room Cusco Amazonico Pueblo Hotel (CAPH), which is located in the Madre de Dios forest near to Puerto Maldonado in South-Eastern Peru. Inka Terra has proposed an US$18 million expansion and restructuring project incorporating the following elements: (i) Expansion of the existing MPPH and the CAPH facilities by 15 and 12 rooms, respectively; (ii) Restructuring of some debt in order to lengthen maturities and improve terms; (iii) Development of two new hotels in Cusco and Puno on the Company''s existing properties at these locations; and (iv) construction of another eco-tourism hotel at Concepcion (also near to Puerto Maldonado) in Amazonia and a mid-level hotel, the Machu Picchu Pueblo Lodge (MPPL), in Aguas Calientes, in order to complement its existing hotels at these locations. The project would be financed in two phases. In the first phase items i and ii will be undertaken. If these are successful, the sponsor will move ahead with items iii and iv. These later activities are unlikely to occur within 2 years and the sponsor will undertake further public disclosure activities (including the release of an updated ERS) at these locations as development occurs.2 The sponsor has a longstanding (25-year) history of promoting and developing "eco-tourism" facilities in Peru. Initially with the Cusco Amazonico Pueblo Hotel and more recently with the Machu Pichu Pueblo Hotel. The Amazonico site was one of the first eco-tourism lodges to be developed in Peru and has supported a range of ecological research initiatives.