January 2002

This sample business plan has been made available to users of Business Plan Pro", business planning
software published by Palo Alto Software. Names, loc ations and numbers may have been c hanged,
and substantial portions of text may have been omitted from the original plan to preserve
confidentiality and proprietary information.

You are welcome to use this plan as a starting point to create your own, but you do not have
permission to reproduce, publish, distribute or even copy this plan as it exists here.

Requests for reprints, ac ademic use, and other dissemination of this sample plan should be emailed
to the marketing department of Palo Alto Software at marketing@paloalto.com. For product
information visit our Website: www.paloalto.com or call: 1-800-229-7526.

Copyright Palo Alto Software, Inc., 1995-2007

 Confidentiality Agreement

The undersigned reader ac knowledges that the information provided by

_________________________ in this business plan is confidential; therefore, reader agrees not to
disc lose it without the express written permission of _________________________.
It is ac knowledged by reader that information to be furnished in this business plan is in all respec ts
confidential in nature, other than information which is in the public domain through other means and
that any disc losure or use of same by reader, may cause serious harm or damage to
_________________________.
Upon request, this document is to be immediately returned to _________________________.

___________________
Signature
___________________
Name (typed or printed)
___________________
Date
This is a business plan. It does not imply an offering of securities.
 Table of Contents
1.0 Executive Summary.............................................................................................................................1
1.1 Objectives ...................................................................................................................................1
1.2 Mission........................................................................................................................................1
1.3 Keys to Success ........................................................................................................................2
2.0 Company Summary.............................................................................................................................2
2.1 Company Ownership .................................................................................................................2
2.2 Company History........................................................................................................................2
2.3 Company Locations and Facilities ..........................................................................................4
3.0 Products ...............................................................................................................................................5
4.0 Market Analysis Summary..................................................................................................................5
4.1 Market Segmentation ................................................................................................................5
5.0 Strategy and Implementation Summary ............................................................................................6
5.1 Competitive Edge ......................................................................................................................6
5.2 Sales Strategy............................................................................................................................6
5.2.1 Sales Forecast........................................................................................................................7
6.0 Management Summary.......................................................................................................................8
6.1 Personnel Plan ...........................................................................................................................8
7.0 Financial Plan ....................................................................................................................................10
7.1 Break-even Analysis................................................................................................................10
7.2 Projected Profit and Loss .......................................................................................................11
7.3 Projected Cash Flow ...............................................................................................................13
7.4 Projected Balance Sheet ........................................................................................................15
7.5 Business Ratios .......................................................................................................................16

Page 1
 Justin Seafood Market

1.0 Executive Summary

Justin Seafood Market has been providing customers with the finest quality seafood for five
years. The business is primarily wholesale to area restaurants. We purchase seafood direc tly
from loc al fishermen and contac ts all along the Florida panhandle. This allows us to pick from the
finest selec tion of seafood available anywhere. Currently, we sell to over sixty restaurants. This
a 10% increase over last year and we estimate that we will have additional restaurants as
customers next year.

Justin Seafood Market plans to expand our storefront and sell direc t to the public. In our
expanded market, we will bring our commitment of quality, freshness and great prices to the
public. By purchasing in large quantities we are able to pass the savings on to our customer.

The planned renovation will cost $150,000. Additional service staff will be hired to assist
customers. Bill Justin, owner of Justin Seafood Market, will invest $50,000 in the expansion and
also secure a $100,000 short-term loan.

1.1 Objectives

• Establish Justin Seafood Market as the leader in selling fresh seafood to the public.
• Increase the number of customers buying from Justin Seafood Market by 10% over the next
two years.
• Establish a Seafood Disc ount Club for customers that will build customer loyalty.

1.2 Mission

The mission of Justin Seafood Market is to offer customers the best seafood prices on the
highest quality seafood.

Page 1
 Justin Seafood Market

1.3 Keys to Success

• Superior products will promote customer loyalty.

• A loc ation that will assure walk-in traffic.
• A program that will create customer loyalty.

2.0 Company Summary

Justin Seafood Market is primarily a wholesaler to area restaurants. Bill Justin, owner of Justin
Seafood Market, has utilized his wholesale bac kground, his experience in the restaurant industry,
and his contac ts with the area's fishermen to build a loyal customer base.

Bill wants to open a seafood market to the public by renovating the building's storefront to
ac commodate the public.

2.1 Company Ownership

Bill Justin is the owner of Justin Seafood Market.

2.2 Company History

Bill Justin started Justin Seafood Market in 1996 in response to the dramatic growth of the
Florida panhandle. Over the past five years, the population has increased by 30% in c ommunities
along the panhandle. But most importantly, tourists have returned to the area. In 2000, tourists
spent over 400 million dollars with panhandle businesses. A significant portion of those sales
were with the area's loyalty. Currently, there are over 1,350 restaurants but that number grows
by 15% annually.

Against this bac kdrop of growth, Bill Justin launched his market. Starting with ten c ustomers in
1996, Justin Seafood Market now serves sixty restaurants.

Page 2
Justin Seafood Market

Page 3
 Justin Seafood Market

Table: Past Performance

Past Performance
1999 2000 2001
Sales $560,000 $644,000 $710,600
Gross Margin $270,000 $320,000 $350,000
Gross Margin % 48.21% 49.69% 49.25%
Operating Expenses $150,000 $170,000 $190,000
Collection Period (days) 0 0 15
Inventory Turnover 0.00 0.00 0.00

Balance Sheet
1999 2000 2001

Current Assets
Cash $40,000 $50,000 $50,000
Accounts Receivable $0 $0 $23,686
Inventory $0 $0 $30,050
Other Current Assets $20,000 $30,000 $50,000
Total Current Assets $60,000 $80,000 $153,736

Long-term Assets
Long-term Assets $80,000 $80,000 $80,000
Accumulated Depreciation $5,000 $10,000 $15,000
Total Long-term Assets $75,000 $70,000 $65,000

Total Assets $135,000 $150,000 $218,736

Current Liabilities
Accounts Payable $10,000 $12,000 $20,000
Current Borrowing $0 $0 $0
Other Current Liabilities (interest free) $0 $0 $0
Total Current Liabilities $10,000 $12,000 $20,000

Long-term Liabilities $30,000 $20,000 $20,000

Total Liabilities $40,000 $32,000 $40,000

Paid-in Capital $0 $0 $0
Retained Earnings ($67,000) ($80,000) ($37,964)
Earnings $162,000 $198,000 $216,700
Total Capital $95,000 $118,000 $178,736

Total Capital and Liabilities $135,000 $150,000 $218,736

Other Inputs
Payment Days 0 0 30
Sales on Credit $0 $0 $284,240
Receivables Turnover 0.00 0.00 12.00

2.3 Company Locations and Facilities

Justin Seafood Market is loc ated at 3456 Main Street, Tallahassee, Florida. After renovation, the
market will have an additional 5,000 ft. of floor space that will be used for the new retail
operation.

Page 4
 Justin Seafood Market

3.0 Products

Justin Seafood Market currently provides numerous seafood products to restaurants in the
Florida panhandle. The market's new public retail outlet will foc us on popular seafood selec tions
that will bring customers into the store.

Justin Seafood Market will have the following retail products:

• Jumbo Fresh Gulf Shrimp;

• Alaskan King Crab;
• Florida Lobster;
• Sea Sc allops;
• Fresh Gulf Fish Filets;
• Yellowfin Tuna;
• Grouper;
• Snapper;
• Amberjac k.

4.0 Market Analysis Summary

Tallahassee has a population of over 160,000 residents but the area rec eives thousands of day
tourists each year. Justin Seafood Market is loc ated in the busiest commercial section of
Tallahassee with excellent foot traffic. Expanding the market's storefront by 5,000 ft. will create
an inviting environment for the public. The market's interior design will foc us on the motif of an
open air fish market. We will advertise the market as a plac e where the public can get quality
seafood at wholesale prices.

4.1 Market Segmentation

Justin Seafood Market is foc used on two customer groups:

• Urban professional working downtown.

• Day tourists.

Table: Market Analysis

Market Analysis
2002 2003 2004 2005 2006
Potential Customers Growth CAGR
Urban Professionals 10% 30,000 33,000 36,300 39,930 43,923 10.00%
Day Tourists 0% 60,000 60,000 60,000 60,000 60,000 0.00%
Total 3.66% 90,000 93,000 96,300 99,930 103,923 3.66%

Page 5
 Justin Seafood Market

5.0 Strategy and Implementation Summary

Justin Seafood Market will expand its storefront and sell direc t to the public. The market is
known as a wholesale operation and we will use that identity to advertise the new service to the
public. We will ask the public "Why pay retail when you can get better quality at wholesale
prices!" Additional staff will be hired to serve the public.

5.1 Competitive Edge

The competitive edge of Justin Seafood Market is the market's commitment of quality, freshness
and great prices. The market's loc ation also assures excellent tourist and resident foot traffic.

5.2 Sales Strategy

Justin Seafood Market will employ two sales approaches for its target customers.

• For Urban Professionals: The market will promote membership in its Seafood Disc ount Club.
Residents will be encouraged to join for $20 a year. As a member, all purchases will be
disc ounted $1 per pound. This will result in c onsiderable saving for members who shop
regularly at the market.

• For the Day Tourist: The market will offer free 24-hour shipping of purchases in excess of
$100. The customer will be able to selec t the day the seafood will be shipped. The customers
will then rec eive a regular newsletter that will include an invitation to purchase seafood again
with same free shipping option.

Page 6
 Justin Seafood Market

5.2.1 Sales Forecast

The following is a very conservative sales forec ast for the next three years. We anticipate
ac tual sales will be much higher after the renovation, but we want to plan for other
contingencies.

Table: Sales Forecast

Sales Forecast
2002 2003 2004
Sales
Over-counter $334,000 $350,000 $380,000
Shipped $122,000 $140,000 $155,000
Restaurant Deliveries $720,000 $800,000 $900,000
Total Sales $1,176,000 $1,290,000 $1,435,000

Direct Cost of Sales 2002 2003 2004

Over-counter $166,500 $173,000 $188,000
Shipped $64,100 $74,000 $81,000
Restaurant Deliveries $359,000 $409,000 $459,000
Subtotal Direct Cost of Sales $589,600 $656,000 $728,000

Page 7
 Justin Seafood Market

6.0 Management Summary

Prior to beginning Justin Seafood Market, Bill Justin worked as an ac count manager for William's
Wholesale Foods and Wilson Seafood for ten years. In his last position with Wilson Seafood, Bill
developed an excellent network of fishing contac ts in the Florida panhandle, generating sales in
excess of $2 million annually. His strength has always been his customer relation skills.

Bill Justin has a BA in marketing from Florida State University. His first position after graduation
was as a shift manager with Johnson Seafood Restaurant. In three years, he was promoted to
the manager position. During that time, Bill demonstrated the ability to effec tively manage a
large staff.

6.1 Personnel Plan

The personnel for Justin Seafood Market is as follows:

• Manager;
• Market staff (4 by year end);
• Delivery crew (4 by year end);
• Sales staff (4 by year end);
• Cleanup crew (2);

Page 8
 Justin Seafood Market

Table: Personnel
Personnel Plan
2002 2003 2004
Manager $36,000 $38,000 $40,000
Market Staff (2-4) $71,750 $90,000 $96,000
Clean-up Crew (2) $45,600 $47,000 $49,000
Delivery Staff (2-4) $82,000 $102,000 $108,000
Sales Staff (3-4) $110,000 $130,000 $140,000
Total People 15 15 15

Total Payroll $345,350 $407,000 $433,000

Page 9
 Justin Seafood Market

7.0 Financial Plan

The following is the financial plan for expansion of Justin Seafood Market to include a new retail
market space.

7.1 Break-even Analysis

The following table and chart show our Break-even Analysis for the coming year.

Table: Break-even Analysis

Break-even Analysis

Monthly Revenue Break-even $95,418

Assumptions:
Average Percent Variable Cost 50%
Estimated Monthly Fixed Cost $47,579

Page 10
 Justin Seafood Market

7.2 Projected Profit and Loss

The following table and charts highlight the projec ted profit and loss for three years.

Page 11
 Justin Seafood Market

Table: Profit and Loss

Pro Forma Profit and Loss
2002 2003 2004
Sales $1,176,000 $1,290,000 $1,435,000
Direct Cost of Sales $589,600 $656,000 $728,000
Other Production Expenses $0 $0 $0
Total Cost of Sales $589,600 $656,000 $728,000

Gross Margin $586,400 $634,000 $707,000

Gross Margin % 49.86% 49.15% 49.27%

Expenses
Payroll $345,350 $407,000 $433,000
Sales and Marketing and Other Expenses $24,000 $30,000 $40,000
Depreciation $9,600 $9,600 $9,600
Renovation Expenses $150,000 $0 $0
Utilities $6,000 $6,000 $6,000
Insurance $0 $0 $0
Rent $36,000 $36,000 $36,000
Payroll Taxes $0 $0 $0
Other $0 $0 $0

Total Operating Expenses $570,950 $488,600 $524,600

Profit Before Interest and Taxes $15,450 $145,400 $182,400

EBITDA $25,050 $155,000 $192,000
Interest Expense $10,675 $8,331 $5,885
Taxes Incurred $1,432 $41,121 $52,955

Net Profit $3,342 $95,948 $123,561

Net Profit/Sales 0.28% 7.44% 8.61%

Page 12
 Justin Seafood Market

7.3 Projected Cash Flow

The following table and chart highlight the projec ted cash flow for three years.

Page 13
 Justin Seafood Market

Table: Cash Flow

Pro Forma Cash Flow
2002 2003 2004
Cash Received

Cash from Operations

Cash Sales $705,600 $774,000 $861,000
Cash from Receivables $397,286 $506,616 $562,065
Subtotal Cash from Operations $1,102,886 $1,280,616 $1,423,065

Additional Cash Received

Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $100,000 $0 $0
New Other Liabilities (interest-free) $0 $0 $0
New Long-term Liabilities $0 $0 $0
Sales of Other Current Assets $0 $0 $0
Sales of Long-term Assets $0 $0 $0
New Investment Received $50,000 $0 $0
Subtotal Cash Received $1,252,886 $1,280,616 $1,423,065

Expenditures 2002 2003 2004

Expenditures from Operations

Cash Spending $345,350 $407,000 $433,000
Bill Payments $800,535 $797,744 $869,803
Subtotal Spent on Operations $1,145,885 $1,204,744 $1,302,803

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $21,600 $21,600 $21,600
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $2,860 $2,860 $2,860
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $1,170,345 $1,229,204 $1,327,263

Net Cash Flow $82,541 $51,412 $95,801

Cash Balance $132,541 $183,953 $279,754

Page 14
 Justin Seafood Market

7.4 Projected Balance Sheet

The following table highlights the projec ted balance sheet for three years.

Table: Balance Sheet

Pro Forma Balance Sheet
2002 2003 2004
Assets

Current Assets
Cash $132,541 $183,953 $279,754
Accounts Receivable $96,800 $106,184 $118,119
Inventory $69,850 $77,716 $86,246
Other Current Assets $50,000 $50,000 $50,000
Total Current Assets $349,191 $417,853 $534,120

Long-term Assets
Long-term Assets $80,000 $80,000 $80,000
Accumulated Depreciation $24,600 $34,200 $43,800
Total Long-term Assets $55,400 $45,800 $36,200
Total Assets $404,591 $463,653 $570,320

Liabilities and Capital 2002 2003 2004

Current Liabilities
Accounts Payable $76,973 $64,547 $72,113
Current Borrowing $78,400 $56,800 $35,200
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $155,373 $121,347 $107,313

Long-term Liabilities $17,140 $14,280 $11,420

Total Liabilities $172,513 $135,627 $118,733

Paid-in Capital $50,000 $50,000 $50,000

Retained Earnings $178,736 $182,078 $278,027
Earnings $3,342 $95,948 $123,561
Total Capital $232,078 $328,027 $451,587
Total Liabilities and Capital $404,591 $463,653 $570,320

Net Worth $232,078 $328,027 $451,587

Page 15
 Justin Seafood Market

7.5 Business Ratios

Business ratios for the years of this plan are shown below. Industry profile ratios based on the
Standard Industrial Classification (SIC) code 5146, Fish and Seafood, are shown for comparison.

Page 16
 Justin Seafood Market

Table: Ratios
Ratio Analysis
2002 2003 2004 Industry Profile
Sales Growth 65.49% 9.69% 11.24% 4.60%

Percent of Total Assets

Accounts Receivable 23.93% 22.90% 20.71% 33.30%
Inventory 17.26% 16.76% 15.12% 25.40%
Other Current Assets 12.36% 10.78% 8.77% 24.00%
Total Current Assets 86.31% 90.12% 93.65% 82.70%
Long-term Assets 13.69% 9.88% 6.35% 17.30%
Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 38.40% 26.17% 18.82% 47.70%

Long-term Liabilities 4.24% 3.08% 2.00% 10.10%
Total Liabilities 42.64% 29.25% 20.82% 57.80%
Net Worth 57.36% 70.75% 79.18% 42.20%

Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 49.86% 49.15% 49.27% 14.20%
Selling, General & Administrative Expenses 46.23% 45.05% 43.86% 9.00%
Advertising Expenses 1.02% 1.16% 1.39% 0.30%
Profit Before Interest and Taxes 1.31% 11.27% 12.71% 0.80%

Main Ratios
Current 2.25 3.44 4.98 1.64
Quick 1.80 2.80 4.17 0.97
Total Debt to Total Assets 42.64% 29.25% 20.82% 57.80%
Pre-tax Return on Net Worth 2.06% 41.79% 39.09% 3.60%
Pre-tax Return on Assets 1.18% 29.56% 30.95% 8.40%

Additional Ratios 2002 2003 2004

Net Profit Margin 0.28% 7.44% 8.61% n.a
Return on Equity 1.44% 29.25% 27.36% n.a

Activity Ratios
Accounts Receivable Turnover 4.86 4.86 4.86 n.a
Collection Days 57 72 71 n.a
Inventory Turnover 10.91 8.89 8.88 n.a
Accounts Payable Turnover 11.14 12.17 12.17 n.a
Payment Days 28 33 28 n.a
Total Asset Turnover 2.91 2.78 2.52 n.a

Debt Ratios
Debt to Net Worth 0.74 0.41 0.26 n.a
Current Liab. to Liab. 0.90 0.89 0.90 n.a

Liquidity Ratios
Net Working Capital $193,818 $296,507 $426,807 n.a
Interest Coverage 1.45 17.45 30.99 n.a

Additional Ratios
Assets to Sales 0.34 0.36 0.40 n.a
Current Debt/Total Assets 38% 26% 19% n.a
Acid Test 1.17 1.93 3.07 n.a
Sales/Net Worth 5.07 3.93 3.18 n.a

Page 17
 Justin Seafood Market
Dividend Payout 0.00 0.00 0.00 n.a

Page 18
 Appendix
Table: Sales Forecast

Sales Forecast
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales
Over-counter 0% $10,000 $10,000 $16,000 $16,000 $21,000 $26,000 $30,000 $40,000 $45,000 $40,000 $40,000 $40,000
Shipped 0% $2,000 $3,000 $5,000 $7,000 $9,000 $11,000 $14,000 $15,000 $17,000 $13,000 $10,000 $16,000
Restaurant Deliveries 0% $30,000 $30,000 $50,000 $55,000 $55,000 $60,000 $70,000 $80,000 $80,000 $70,000 $70,000 $70,000
Total Sales $42,000 $43,000 $71,000 $78,000 $85,000 $97,000 $114,000 $135,000 $142,000 $123,000 $120,000 $126,000

Direct Cost of Sales Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Over-counter $5,000 $5,000 $8,000 $8,000 $10,000 $13,000 $15,000 $20,000 $22,500 $20,000 $20,000 $20,000
Shipped $1,100 $1,600 $2,600 $3,800 $4,500 $5,500 $7,500 $8,000 $8,500 $6,500 $6,000 $8,500
Restaurant Deliveries $15,000 $15,000 $25,000 $27,000 $27,000 $30,000 $35,000 $40,000 $40,000 $35,000 $35,000 $35,000
Subtotal Direct Cost of Sales $21,100 $21,600 $35,600 $38,800 $41,500 $48,500 $57,500 $68,000 $71,000 $61,500 $61,000 $63,500

Page 1
 Appendix
Table: Personnel

Personnel Plan
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Manager 0% $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Market Staff (2-4) 0% $3,500 $3,500 $3,500 $5,250 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000 $7,000
Clean-up Crew (2) 0% $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800 $3,800
Delivery Staff (2-4) 0% $4,000 $4,000 $4,000 $6,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000 $8,000
Sales Staff (3-4) 0% $7,500 $7,500 $7,500 $7,500 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000 $10,000
Total People 10 10 10 12 15 15 15 15 15 15 15 15

Total Payroll $21,800 $21,800 $21,800 $25,550 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800

Page 2
 Appendix
Table: General Assumptions

General Assumptions
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Plan Month 1 2 3 4 5 6 7 8 9 10 11 12
Current Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00% 10.00%
Tax Rate 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00% 30.00%
Other 0 0 0 0 0 0 0 0 0 0 0 0

Page 3
 Appendix
Table: Profit and Loss

Pro Forma Profit and Loss

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales $42,000 $43,000 $71,000 $78,000 $85,000 $97,000 $114,000 $135,000 $142,000 $123,000 $120,000 $126,000
Direct Cost of Sales $21,100 $21,600 $35,600 $38,800 $41,500 $48,500 $57,500 $68,000 $71,000 $61,500 $61,000 $63,500
Other Production Expenses $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $21,100 $21,600 $35,600 $38,800 $41,500 $48,500 $57,500 $68,000 $71,000 $61,500 $61,000 $63,500

Gross Margin $20,900 $21,400 $35,400 $39,200 $43,500 $48,500 $56,500 $67,000 $71,000 $61,500 $59,000 $62,500
Gross Margin % 49.76% 49.77% 49.86% 50.26% 51.18% 50.00% 49.56% 49.63% 50.00% 50.00% 49.17% 49.60%

Expenses
Payroll $21,800 $21,800 $21,800 $25,550 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800
Sales and Marketing and Other $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
Expenses
Depreciation $800 $800 $800 $800 $800 $800 $800 $800 $800 $800 $800 $800
Renovation Expenses $60,000 $40,000 $20,000 $30,000 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Insurance $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000 $3,000
Payroll Taxes 15% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Operating Expenses $88,100 $68,100 $48,100 $61,850 $38,100 $38,100 $38,100 $38,100 $38,100 $38,100 $38,100 $38,100

Profit Before Interest and Taxes ($67,200) ($46,700) ($12,700) ($22,650) $5,400 $10,400 $18,400 $28,900 $32,900 $23,400 $20,900 $24,400
EBITDA ($66,400) ($45,900) ($11,900) ($21,850) $6,200 $11,200 $19,200 $29,700 $33,700 $24,200 $21,700 $25,200
Interest Expense $983 $966 $949 $932 $915 $898 $881 $864 $847 $830 $813 $796
Taxes Incurred ($20,455) ($14,300) ($4,095) ($7,075) $1,345 $2,851 $5,256 $8,411 $9,616 $6,771 $6,026 $7,081

Net Profit ($47,728) ($33,366) ($9,554) ($16,507) $3,139 $6,651 $12,263 $19,625 $22,437 $15,799 $14,061 $16,523
Net Profit/Sales -113.64% -77.60% -13.46% -21.16% 3.69% 6.86% 10.76% 14.54% 15.80% 12.84% 11.72% 13.11%

Page 4
 Appendix
Table: Cash Flow

Pro Forma Cash Flow

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Cash Received

Cash from Operations

Cash Sales $25,200 $25,800 $42,600 $46,800 $51,000 $58,200 $68,400 $81,000 $85,200 $73,800 $72,000 $75,600
Cash from Receivables $11,843 $12,403 $16,813 $17,573 $28,493 $31,293 $34,160 $39,027 $45,880 $54,093 $56,547 $49,160
Subtotal Cash from Operations $37,043 $38,203 $59,413 $64,373 $79,493 $89,493 $102,560 $120,027 $131,080 $127,893 $128,547 $124,760

Additional Cash Received

Sales Tax, VAT, HST/GST Received 0.00% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Current Borrowing $100,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Sales of Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Investment Received $50,000 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $187,043 $38,203 $59,413 $64,373 $79,493 $89,493 $102,560 $120,027 $131,080 $127,893 $128,547 $124,760

Expenditures Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Expenditures from Operations

Cash Spending $21,800 $21,800 $21,800 $25,550 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800 $31,800
Bill Payments $22,010 $60,089 $54,951 $73,298 $71,029 $52,671 $65,902 $79,546 $94,189 $89,393 $64,439 $73,017
Subtotal Spent on Operations $43,810 $81,889 $76,751 $98,848 $102,829 $84,471 $97,702 $111,346 $125,989 $121,193 $96,239 $104,817

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Principal Repayment of Current Borrowing $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800
Other Liabilities Principal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Long-term Liabilities Principal Repayment $238 $238 $238 $238 $238 $238 $238 $238 $238 $238 $240 $240
Purchase Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Purchase Long-term Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Spent $45,848 $83,927 $78,789 $100,886 $104,867 $86,509 $99,740 $113,384 $128,027 $123,231 $98,279 $106,857

Net Cash Flow $141,195 ($45,724) ($19,375) ($36,513) ($25,374) $2,984 $2,820 $6,642 $3,053 $4,663 $30,268 $17,903
Cash Balance $191,195 $145,471 $126,096 $89,583 $64,209 $67,193 $70,013 $76,656 $79,708 $84,371 $114,639 $132,541

Page 5
 Appendix
Table: Balance Sheet

Pro Forma Balance Sheet

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Assets Starting Balances

Current Assets
Cash $50,000 $191,195 $145,471 $126,096 $89,583 $64,209 $67,193 $70,013 $76,656 $79,708 $84,371 $114,639 $132,541
Accounts Receivable $23,686 $28,643 $33,440 $45,027 $58,653 $64,160 $71,667 $83,107 $98,080 $109,000 $104,107 $95,560 $96,800
Inventory $30,050 $23,210 $23,760 $39,160 $42,680 $45,650 $53,350 $63,250 $74,800 $78,100 $67,650 $67,100 $69,850
Other Current Assets $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000
Total Current Assets $153,736 $293,048 $252,671 $260,283 $240,916 $224,019 $242,210 $266,370 $299,536 $316,808 $306,128 $327,299 $349,191

Long-term Assets
Long-term Assets $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000
Accumulated Depreciation $15,000 $15,800 $16,600 $17,400 $18,200 $19,000 $19,800 $20,600 $21,400 $22,200 $23,000 $23,800 $24,600
Total Long-term Assets $65,000 $64,200 $63,400 $62,600 $61,800 $61,000 $60,200 $59,400 $58,600 $57,800 $57,000 $56,200 $55,400
Total Assets $218,736 $357,248 $316,071 $322,883 $302,716 $285,019 $302,410 $325,770 $358,136 $374,608 $363,128 $383,499 $404,591

Liabilities and Capital Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Current Liabilities
Accounts Payable $20,000 $58,279 $52,506 $70,909 $69,288 $50,490 $63,267 $76,402 $91,181 $87,254 $62,013 $70,363 $76,973
Current Borrowing $0 $98,200 $96,400 $94,600 $92,800 $91,000 $89,200 $87,400 $85,600 $83,800 $82,000 $80,200 $78,400
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Current Liabilities $20,000 $156,479 $148,906 $165,509 $162,088 $141,490 $152,467 $163,802 $176,781 $171,054 $144,013 $150,563 $155,373

Long-term Liabilities $20,000 $19,762 $19,524 $19,286 $19,048 $18,810 $18,572 $18,334 $18,096 $17,858 $17,620 $17,380 $17,140
Total Liabilities $40,000 $176,241 $168,430 $184,795 $181,136 $160,300 $171,039 $182,136 $194,877 $188,912 $161,633 $167,943 $172,513

Paid-in Capital $0 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000
Retained Earnings ($37,964) $178,736 $178,736 $178,736 $178,736 $178,736 $178,736 $178,736 $178,736 $178,736 $178,736 $178,736 $178,736
Earnings $216,700 ($47,728) ($81,094) ($90,649) ($107,156) ($104,017) ($97,365) ($85,102) ($65,477) ($43,040) ($27,241) ($13,180) $3,342
Total Capital $178,736 $181,008 $147,642 $138,087 $121,580 $124,719 $131,371 $143,634 $163,259 $185,696 $201,495 $215,556 $232,078
Total Liabilities and Capital $218,736 $357,248 $316,071 $322,883 $302,716 $285,019 $302,410 $325,770 $358,136 $374,608 $363,128 $383,499 $404,591

Net Worth $178,736 $181,008 $147,642 $138,087 $121,580 $124,719 $131,371 $143,634 $163,259 $185,696 $201,495 $215,556 $232,078

Page 6