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The undersigned reader acknowledges that the information provided by

_________________________ in this business plan is confidential; therefore, reader agrees not to
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It is acknowledged by reader that information to be furnished in this business plan is in all respects
confidential in nature, other than information which is in the public domain through other means
and that any disclosure or use of same by reader, may cause serious harm or damage to
_________________________.

Upon request, this document is to be immediately returned to _________________________.

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___________________
Date

This is a business plan. It does not imply an offering of securities.

 Table of Contents

1.0 Executive Summary .................................................................................................................... 1

Chart: Highlights .......................................................................................................................... 1
1.1 Objectives.................................................................................................................................... 1
1.2 Mission .......................................................................................................................................... 1
1.3 Keys to Success ........................................................................................................................ 2
2.0 Company Summary ..................................................................................................................... 2
2.1 Start-up Summary ................................................................................................................... 2
Table: Start-up Funding ............................................................................................................ 2
Chart: Start-up ............................................................................................................................. 3
Table: Start-up.............................................................................................................................. 3
3.0 Services ............................................................................................................................................ 4
4.0 Market Analysis Summary ........................................................................................................ 4
4.1 Target Market Segment Strategy ...................................................................................... 4
4.2 Service Business Analysis ..................................................................................................... 4
4.3 Market Segmentation ............................................................................................................. 4
Chart: Market Analysis (Pie) .................................................................................................... 5
Table: Market Analysis ............................................................................................................... 5
4.4 Competition and Buying Patterns ...................................................................................... 5
5.0 Strategy and Implementation Summary ............................................................................ 5
5.1 Competitive Edge ..................................................................................................................... 5
5.2 Sales Forecast ........................................................................................................................... 6
Chart: Sales Monthly .................................................................................................................. 6
Table: Sales Forecast ................................................................................................................. 6
6.0 Management Summary .............................................................................................................. 7
Table: Personnel ........................................................................................................................... 7
7.0 Financial Plan ................................................................................................................................. 7
7.1 Important Assumptions ......................................................................................................... 7
Table: General Assumptions .................................................................................................... 7
7.2 Break-even Analysis ................................................................................................................ 8
7.2 Break-even Analysis ................................................................................................................ 8
Chart: Break-even Analysis ..................................................................................................... 8
Table: Break-even Analysis...................................................................................................... 8
7.3 Projected Profit and Loss ....................................................................................................... 9
7.3 Projected Profit and Loss ....................................................................................................... 9
Table: Profit and Loss ................................................................................................................. 9
7.4 Projected Cash Flow .............................................................................................................. 10
7.4 Projected Cash Flow .............................................................................................................. 10
Chart: Cash .................................................................................................................................. 10
Table: Cash Flow ........................................................................................................................ 10
7.5 Projected Balance Sheet ...................................................................................................... 12
7.5 Projected Balance Sheet ...................................................................................................... 12
Table: Balance Sheet ................................................................................................................ 12
7.6 Business Ratios ....................................................................................................................... 12
Table: Ratios ................................................................................................................................ 12

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 Table of Contents

Table: Sales Forecast ......................................................................................................................... 1

Table: Personnel ................................................................................................................................... 2
Table: Personnel ................................................................................................................................... 2
Table: General Assumptions ............................................................................................................ 3
Table: General Assumptions ............................................................................................................ 3
Table: Profit and Loss ......................................................................................................................... 4
Table: Profit and Loss ......................................................................................................................... 4
Table: Cash Flow .................................................................................................................................. 5
Table: Cash Flow .................................................................................................................................. 5
Table: Balance Sheet .......................................................................................................................... 6
Table: Balance Sheet .......................................................................................................................... 6

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 Doggie Pause

1.0 Executive Summary

Doggie Pause is a canine daycare facility catering to professionals who have disposable income
and the desire to provide quality care for their pets while they are work. It is a response to a
real market need in a high-end high-income market.

Chart: Highlights

1.1 Objectives

1. To launch the business and develop sales approaching $25K per month by the end of the
first year.
2. To break even in the second year, and be profitable by the third year.
3. To increase sales by 20% per year in the second and third year while also becoming
profitable.

1.2 Mission

We will be the leaders in the market of canine care for the upscale community by providing a
positive environment for the animals that we house. Our operations will instill in owners
confidence in our ability to care for their pets in appropriate ways. We will control significant
market share and increase profit as we grow and expand. We will develop our business
conservatively, financing our growth through operational revenue.

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1.3 Keys to Success

1. The initial location will be in an upscale community on the outskirts of the metropolitan
area.
2. We will cater to the needs of our canine owners as much as possible.
3. We will uphold the statement 'the customer is always right' because when it comes to
canines, owners know best.
4. The business finances will be run in an organized and timely manner.

2.0 Company Summary

Doggie Pause will be established as a Subchapter S corporation owned in equal shares by two
founders, Barque Oldeyeller and Rufe Rintintin. We are working with the local legal firm Akita,
Shar-Pei, Pug & Kesshond, to establish the legal entity.

2.1 Start-up Summary

The start up for Doggie Pause will be simple and cost efficient. Rent and utilities will be the
main expense, which will consist of a large building space and office. There will be many
advertising expenses in the beginning that will promote the service, and this expense will
lessen as months go on and people become aware of our service. Start-up inventory will be
mainly shampoo and grooming supplies, food for the dogs, and other supplies like bedding.
Assets will be the kennels and play structures for the dogs, and the bathing facilities.

Loans will be needed to start up the company, and we will also be investing some of our own
funds. At this point we're planning to invest $10,000 each as founders, and to take a small
business loan of $42K. The loan will be paid off over three years as shown in the cash flow.

Table: Start-up Funding

Start-up Funding
Start-up Expenses to Fund $32,500
Start-up Assets to Fund $27,500
Total Funding Required $60,000

Assets
Non-cash Assets from Start-up $7,500
Cash Requirements from Start-up $20,000
Additional Cash Raised $0
Cash Balance on Starting Date $20,000
Total Assets $27,500

Liabilities and Capital

Liabilities
Current Borrowing $40,000
Long-term Liabilities $0
Accounts Payable (Outstanding Bills) $0
Other Current Liabilities (interest-free) $0
Total Liabilities $40,000

Capital

Planned Investment

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 Doggie Pause

Barque Oldeyeller $10,000

Rufe Rintintin $10,000
Other $0
Additional Investment Requirement $0
Total Planned Investment $20,000

Loss at Start-up (Start-up Expenses) ($32,500)

Total Capital ($12,500)

Total Capital and Liabilities $27,500

Total Funding $60,000

Chart: Start-up

Table: Start-up

Start-up

Requirements

Start-up Expenses
Legal $1,500
Brochures $1,500
Insurance $5,000
Rent $2,500
Expensed equipment $20,000
Other $2,000
Total Start-up Expenses $32,500

Start-up Assets
Cash Required $20,000
Other Current Assets $0

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 Doggie Pause

Long-term Assets $7,500

Total Assets $27,500

Total Requirements $60,000

3.0 Services

Doggie Pause offers upscale dog owners a place where they can leave their pets while at work,
and away for weekend trips or on vacation. It also offers feeding and exercising, as well as
washing, grooming and low-level veterinary services. The location will be a large lot on the
outskirts of a high-income residential area. Our projections include a heavy rent because of the
location requirements. Customers pay by the day, by the hour, or by the month. Our
assumption is that the average customer generates about $250 per month.

4.0 Market Analysis Summary

The market for Doggie Pause is all of the dog owners in the metropolitan area and surrounding
areas of the city. We believe that this is going to be 2/3 of the population, and we have a goal
of gaining a 50% market share. We have a target of a 20% yearly profit increase as the
business continues.

4.1 Target Market Segment Strategy

We have chosen our target market because they own canines and have the ability to afford a
service such as Doggie Pause. We are aware that our service is an extra in life, not a
necessity. We anticipate and expect to cater to the upper-class citizens within our geographical
area.

4.2 Service Business Analysis

Our familiarity with this business indicates that the service we offer is not currently available
anywhere within the metropolitan area. We think our marketing problem will be more a matter
of making dog owners aware of the Doggie Pause, than it will be related to the competition.

4.3 Market Segmentation

Our target market consists of canine owners that have the financial capabilities to care for their
dogs in an elaborate manner. Most will be from double income homes with high profile jobs that
require an extensive amount of time away from the home. Our target market consists of men
and women primarily between the ages of 35 and 65. They live in the upscale suburbs
surrounding the metropolitan area. Our market segment customers will lead a lifestyle in which
their canines play a large part, and these pets are often seen as "children" by their owners.

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 Doggie Pause

Chart: Market Analysis (Pie)

Table: Market Analysis

Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential Customers Growth CAGR
Canine Owners 20% 15,000 18,000 21,600 25,920 31,104 20.00%
Other 0% 0 0 0 0 0 0.00%
Total 20.00% 15,000 18,000 21,600 25,920 31,104 20.00%

4.4 Competition and Buying Patterns

Our real competition is owners choosing to leave their dogs at home unattended. We recognize
that only relatively wealthy people will be interested in spending an average of $250 monthly to
provide daycare for their dogs. Still, there should be sufficient market.

5.0 Strategy and Implementation Summary

Doggie Pause will focus on the geographical market of upper-class suburbs surrounding the
metropolitan area. Our initial site will be in West Linn, a suburb of Portland. Our target market
consists mainly of men and women ages 35-65.

5.1 Competitive Edge

Doggie Pause is the first canine daycare facility of its kind. Never before has there been a place
where a canine owner could take their dog to be cared for, for the day. The owner feels no guilt
in leaving the dog because it is a secure, safe and fun environment.

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 Doggie Pause

5.2 Sales Forecast

Sales are based on an hourly fee for each dog. There will be a $15.00/hour charge for the "day
care." This includes the care of the dogs, and grooming services. Forecasted sales are based on
the estimated number of dogs that will be cared for daily, and an average of how many hours
each dog will be housed per day. There is an assumption that we will initially be offering
services Monday through Friday, 7 AM to 6 PM, with time for owners to drop off and pick up
their pets before and after work. Sales will increase as months go on, due to an increase in
number of dogs per day that we are caring for.

Services will expand to include weekends and long-term "vacation" boarding as the need and
demand arises.

Chart: Sales Monthly

Table: Sales Forecast

Sales Forecast
Year 1 Year 2 Year 3
Sales
Doggie care hours (all inclusive) $135,479 $163,000 $196,000
Other $14,250 $17,000 $20,000
Total Sales $149,729 $180,000 $216,000

Direct Cost of Sales Year 1 Year 2 Year 3

Doggie care hours (all inclusive) $13,548 $16,300 $19,600
Other $4,988 $5,950 $7,000
Subtotal Direct Cost of Sales $18,535 $22,250 $26,600

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 Doggie Pause

6.0 Management Summary

The management team will consist of the two co-founders, Barque Oldeyeller and Rufe
Rintintin. We do not anticipate taking on other managers until locations are opened in other
metropolitan areas. As we grow we expect to need outside guidance in the areas of accounting
and financial advising.

Table: Personnel

Personnel Plan
Year 1 Year 2 Year 3
Dog care assistants/groomers $56,000 $76,800 $76,800
Admin/etc. $8,800 $15,000 $25,000
Total People 6 6 7

Total Payroll $64,800 $91,800 $101,800

7.0 Financial Plan

We want to finance the start-up of our company mainly through personal investment and a
short-term business loan. We think this is a good risk/return situation and we will provide the
necessary personal guarantees to secure the business loan. We will finance growth through the
collection of the fees for our services. We understand that without these payments we will not
be able to be a profitable business.

7.1 Important Assumptions

Our important financial assumptions are shown below.

Table: General Assumptions

General Assumptions
Year 1 Year 2 Year 3
Plan Month 1 2 3
Current Interest Rate 10.00% 10.00% 10.00%
Long-term Interest Rate 10.00% 10.00% 10.00%
Tax Rate 25.42% 25.00% 25.42%
Other 0 0 0

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 Doggie Pause

7.2 Break-even Analysis

According to our break-even projections, we need more than $12,000 in monthly sales to break
even. We think this is a manageable sales amount. Furthermore, a significant portion of our
fixed cost is our own salaries, so that reduces risk as well.

Chart: Break-even Analysis

Table: Break-even Analysis

Break-even Analysis

Monthly Revenue Break-even $12,197

Assumptions:
Average Percent Variable Cost 12%
Estimated Monthly Fixed Cost $10,687

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 Doggie Pause

7.3 Projected Profit and Loss

The projections show how we intend to almost break even in the first year (a loss of less than
$1,000), make a small profit in the second year and show profit of 9% on sales in the third
year. We are confident that even though we have a loss in the first months after opening, we
will be profitable in the future as years go on and business increases.

Table: Profit and Loss

Pro Forma Profit and Loss

Year 1 Year 2 Year 3
Sales $149,729 $180,000 $216,000
Direct Cost of Sales $18,535 $22,250 $26,600
Other $0 $0 $0
Total Cost of Sales $18,535 $22,250 $26,600

Gross Margin $131,194 $157,750 $189,400

Gross Margin % 87.62% 87.64% 87.69%

Expenses
Payroll $64,800 $91,800 $101,800
Sales and Marketing and Other Expenses $15,000 $9,000 $6,000
Depreciation $0 $0 $0
Leased Equipment $0 $0 $0
Utilities $2,725 $3,000 $3,000
Insurance $6,000 $6,000 $6,000
Rent $30,000 $30,000 $30,000
Payroll Taxes $9,720 $13,770 $15,270
Other $0 $0 $0

Total Operating Expenses $128,245 $153,570 $162,070

Profit Before Interest and Taxes $2,949 $4,180 $27,330

EBITDA $2,949 $4,180 $27,330
Interest Expense $3,324 $2,032 $666
Taxes Incurred $0 $537 $6,777

Net Profit ($375) $1,611 $19,887

Net Profit/Sales -0.25% 0.89% 9.21%

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 Doggie Pause

7.4 Projected Cash Flow

For Doggie Pause to be successful we need a steady growth in clientele. Without customers
bringing in their canines we have no cash flow, no profit, and no business. The cash flow
depends on a bridge loan in mid-year from the founders, to be repaid at the end of the year.

Chart: Cash

Table: Cash Flow

Pro Forma Cash Flow

Year 1 Year 2 Year 3
Cash Received

Cash from Operations

Cash Sales $149,729 $180,000 $216,000
Subtotal Cash from Operations $149,729 $180,000 $216,000

Additional Cash Received

Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $0 $0
New Other Liabilities (interest-free) $10,000 $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 $0 $0 $0
Subtotal Cash Received $159,729 $180,000 $216,000

Expenditures Year 1 Year 2 Year 3

Expenditures from Operations

Cash Spending $64,800 $91,800 $101,800

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 Doggie Pause

Bill Payments $77,005 $87,772 $93,678

Subtotal Spent on Operations $141,805 $179,572 $195,478

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $12,673 $14,004 $13,322
Other Liabilities Principal Repayment $10,000 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $164,478 $193,576 $208,800

Net Cash Flow ($4,749) ($13,576) $7,200

Cash Balance $15,251 $1,675 $8,874

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 Doggie Pause

7.5 Projected Balance Sheet

The projected balance sheet shows stability and a gradual increase of net worth.

Table: Balance Sheet

Pro Forma Balance Sheet

Year 1 Year 2 Year 3
Assets

Current Assets
Cash $15,251 $1,675 $8,874
Other Current Assets $0 $0 $0
Total Current Assets $15,251 $1,675 $8,874

Long-term Assets
Long-term Assets $7,500 $7,500 $7,500
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $7,500 $7,500 $7,500
Total Assets $22,751 $9,175 $16,374

Liabilities and Capital Year 1 Year 2 Year 3

Current Liabilities
Accounts Payable $8,299 $7,117 $7,752
Current Borrowing $27,327 $13,322 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $35,626 $20,439 $7,752

Long-term Liabilities $0 $0 $0
Total Liabilities $35,626 $20,439 $7,752

Paid-in Capital $20,000 $20,000 $20,000

Retained Earnings ($32,500) ($32,875) ($31,265)
Earnings ($375) $1,611 $19,887
Total Capital ($12,875) ($11,265) $8,622
Total Liabilities and Capital $22,751 $9,175 $16,374

Net Worth ($12,875) ($11,265) $8,622

7.6 Business Ratios

Table: Ratios

Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth n.a. 20.22% 20.00% -2.90%

Percent of Total Assets

Other Current Assets 0.00% 0.00% 0.00% 31.90%
Total Current Assets 67.03% 18.25% 54.20% 55.90%
Long-term Assets 32.97% 81.75% 45.80% 44.10%
Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 156.59% 222.78% 47.34% 32.70%

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 Doggie Pause

Long-term Liabilities 0.00% 0.00% 0.00% 19.90%

Total Liabilities 156.59% 222.78% 47.34% 52.60%
Net Worth -56.59% -122.78% 52.66% 47.40%

Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 87.62% 87.64% 87.69% 42.50%
Selling, General & Administrative Expenses 88.01% 86.83% 78.47% 26.40%
Advertising Expenses 10.02% 5.00% 2.78% 0.50%
Profit Before Interest and Taxes 1.97% 2.32% 12.65% 2.40%

Main Ratios
Current 0.43 0.08 1.14 2.19
Quick 0.43 0.08 1.14 1.48
Total Debt to Total Assets 156.59% 222.78% 47.34% 52.60%
Pre-tax Return on Net Worth 2.92% -19.06% 309.25% 4.50%
Pre-tax Return on Assets -1.65% 23.41% 162.84% 9.40%

Additional Ratios Year 1 Year 2 Year 3

Net Profit Margin -0.25% 0.89% 9.21% n.a
Return on Equity 0.00% 0.00% 230.65% n.a

Activity Ratios
Accounts Payable Turnover 10.28 12.17 12.17 n.a
Payment Days 27 32 29 n.a
Total Asset Turnover 6.58 19.62 13.19 n.a

Debt Ratios
Debt to Net Worth 0.00 0.00 0.90 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a

Liquidity Ratios
Net Working Capital ($20,375) ($18,765) $1,122 n.a
Interest Coverage 0.89 2.06 41.03 n.a

Additional Ratios
Assets to Sales 0.15 0.05 0.08 n.a
Current Debt/Total Assets 157% 223% 47% n.a
Acid Test 0.43 0.08 1.14 n.a
Sales/Net Worth 0.00 0.00 25.05 n.a
Dividend Payout 0.00 0.00 0.00 n.a

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 Appendix

Table: Sales Forecast

Sales Forecast
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Sales
Doggie care hours (all inclusive) 20% $5,125 $5,395 $6,835 $12,595 $9,265 $7,825 $8,095 $8,635 $11,245 $15,714 $20,395 $24,355
Other 20% $765 $585 $705 $1,215 $585 $705 $1,215 $1,095 $1,305 $1,785 $2,055 $2,235
Total Sales $5,890 $5,980 $7,540 $13,810 $9,850 $8,530 $9,310 $9,730 $12,550 $17,499 $22,450 $26,590

Direct Cost of Sales Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Doggie care hours (all inclusive) 10% $513 $540 $684 $1,260 $927 $783 $810 $864 $1,125 $1,571 $2,040 $2,436
Other 35% $268 $205 $247 $425 $205 $247 $425 $383 $457 $625 $719 $782
Subtotal Direct Cost of Sales $780 $744 $930 $1,685 $1,131 $1,029 $1,235 $1,247 $1,581 $2,196 $2,759 $3,218

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 Appendix

Table: Personnel

Personnel Plan
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Dog care assistants/groomers 0% $3,200 $3,200 $3,200 $4,800 $4,800 $4,800 $4,800 $4,800 $4,800 $4,800 $6,400 $6,400
Admin/etc. 0% $500 $500 $500 $500 $500 $500 $500 $500 $1,200 $1,200 $1,200 $1,200
Total People 3 3 3 4 4 4 4 4 5 5 6 6

Total Payroll $3,700 $3,700 $3,700 $5,300 $5,300 $5,300 $5,300 $5,300 $6,000 $6,000 $7,600 $7,600

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 Appendix

Table: General Assumptions

General Assumptions
Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
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% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00% 25.00%
Other 0 0 0 0 0 0 0 0 0 0 0 0

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 Appendix

Table: Profit and Loss

Pro Forma Profit and Loss

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Sales $5,890 $5,980 $7,540 $13,810 $9,850 $8,530 $9,310 $9,730 $12,550 $17,499 $22,450 $26,590
Direct Cost of Sales $780 $744 $930 $1,685 $1,131 $1,029 $1,235 $1,247 $1,581 $2,196 $2,759 $3,218
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Cost of Sales $780 $744 $930 $1,685 $1,131 $1,029 $1,235 $1,247 $1,581 $2,196 $2,759 $3,218

Gross Margin $5,110 $5,236 $6,610 $12,125 $8,719 $7,501 $8,075 $8,483 $10,969 $15,303 $19,691 $23,372
Gross Margin % 86.75% 87.55% 87.66% 87.80% 88.52% 87.93% 86.74% 87.19% 87.40% 87.45% 87.71% 87.90%

Expenses
Payroll $3,700 $3,700 $3,700 $5,300 $5,300 $5,300 $5,300 $5,300 $6,000 $6,000 $7,600 $7,600
Sales and Marketing and Other $3,000 $2,000 $2,000 $1,000 $1,000 $1,000 $1,000 $1,000 $750 $750 $750 $750
Expenses
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Leased Equipment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Utilities $200 $200 $200 $225 $225 $225 $225 $225 $250 $250 $250 $250
Insurance $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Rent $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500 $2,500
Payroll Taxes 15% $555 $555 $555 $795 $795 $795 $795 $795 $900 $900 $1,140 $1,140
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Operating Expenses $10,455 $9,455 $9,455 $10,320 $10,320 $10,320 $10,320 $10,320 $10,900 $10,900 $12,740 $12,740

Profit Before Interest and Taxes ($5,345) ($4,219) ($2,845) $1,805 ($1,601) ($2,819) ($2,245) ($1,837) $69 $4,403 $6,951 $10,632
EBITDA ($5,345) ($4,219) ($2,845) $1,805 ($1,601) ($2,819) ($2,245) ($1,837) $69 $4,403 $6,951 $10,632
Interest Expense $325 $316 $308 $299 $291 $282 $273 $264 $255 $246 $237 $228
Taxes Incurred $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net Profit ($5,670) ($4,536) ($3,153) $1,506 ($1,892) ($3,101) ($2,518) ($2,101) ($186) $4,157 $6,714 $10,405
Net Profit/Sales -96.27% -75.85% -41.82% 10.90% -19.21% -36.36% -27.04% -21.59% -1.49% 23.75% 29.91% 39.13%

Page 4
 Appendix

Table: Cash Flow

Pro Forma Cash Flow

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Cash Received

Cash from Operations

Cash Sales $5,890 $5,980 $7,540 $13,810 $9,850 $8,530 $9,310 $9,730 $12,550 $17,499 $22,450 $26,590
Subtotal Cash from Operations $5,890 $5,980 $7,540 $13,810 $9,850 $8,530 $9,310 $9,730 $12,550 $17,499 $22,450 $26,590

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 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
New Other Liabilities (interest-free) $0 $0 $0 $0 $0 $0 $10,000 $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 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $5,890 $5,980 $7,540 $13,810 $9,850 $8,530 $19,310 $9,730 $12,550 $17,499 $22,450 $26,590

Expenditures Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

Expenditures from Operations

Cash Spending $3,700 $3,700 $3,700 $5,300 $5,300 $5,300 $5,300 $5,300 $6,000 $6,000 $7,600 $7,600
Bill Payments $262 $7,825 $6,822 $6,994 $6,985 $6,438 $6,338 $6,528 $6,538 $6,757 $7,369 $8,151
Subtotal Spent on Operations $3,962 $11,525 $10,522 $12,294 $12,285 $11,738 $11,638 $11,828 $12,538 $12,757 $14,969 $15,751

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 $1,009 $1,017 $1,025 $1,034 $1,043 $1,051 $1,060 $1,069 $1,078 $1,087 $1,096 $1,105
Other Liabilities Principal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $10,000
Long-term Liabilities Principal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
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 $4,971 $12,542 $11,547 $13,328 $13,328 $12,789 $12,698 $12,897 $13,616 $13,843 $16,065 $26,856

Net Cash Flow $919 ($6,562) ($4,007) $482 ($3,478) ($4,259) $6,612 ($3,167) ($1,066) $3,656 $6,385 ($266)
Cash Balance $20,919 $14,357 $10,350 $10,832 $7,355 $3,095 $9,707 $6,541 $5,475 $9,131 $15,516 $15,251

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 Appendix

Table: Balance Sheet

Pro Forma Balance Sheet

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12
Assets Starting Balances

Current Assets
Cash $20,000 $20,919 $14,357 $10,350 $10,832 $7,355 $3,095 $9,707 $6,541 $5,475 $9,131 $15,516 $15,251
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $20,000 $20,919 $14,357 $10,350 $10,832 $7,355 $3,095 $9,707 $6,541 $5,475 $9,131 $15,516 $15,251

Long-term Assets
Long-term Assets $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Long-term Assets $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500 $7,500
Total Assets $27,500 $28,419 $21,857 $17,850 $18,332 $14,855 $10,595 $17,207 $14,041 $12,975 $16,631 $23,016 $22,751

Liabilities and Capital Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12

Current Liabilities
Accounts Payable $0 $7,598 $6,589 $6,760 $6,771 $6,227 $6,120 $6,310 $6,313 $6,512 $7,097 $7,864 $8,299
Current Borrowing $40,000 $38,991 $37,974 $36,949 $35,915 $34,872 $33,821 $32,761 $31,692 $30,614 $29,528 $28,432 $27,327
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $10,000 $10,000 $10,000 $10,000 $10,000 $0
Subtotal Current Liabilities $40,000 $46,590 $44,563 $43,709 $42,686 $41,100 $39,941 $49,071 $48,005 $47,126 $46,625 $46,296 $35,626

Long-term Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Liabilities $40,000 $46,590 $44,563 $43,709 $42,686 $41,100 $39,941 $49,071 $48,005 $47,126 $46,625 $46,296 $35,626

Paid-in Capital $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $20,000
Retained Earnings ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500) ($32,500)
Earnings $0 ($5,670) ($10,206) ($13,359) ($11,853) ($13,745) ($16,846) ($19,364) ($21,465) ($21,651) ($17,494) ($10,780) ($375)
Total Capital ($12,500) ($18,170) ($22,706) ($25,859) ($24,353) ($26,245) ($29,346) ($31,864) ($33,965) ($34,151) ($29,994) ($23,280) ($12,875)
Total Liabilities and Capital $27,500 $28,419 $21,857 $17,850 $18,332 $14,855 $10,595 $17,207 $14,041 $12,975 $16,631 $23,016 $22,751

Net Worth ($12,500) ($18,170) ($22,706) ($25,859) ($24,353) ($26,245) ($29,346) ($31,864) ($33,965) ($34,151) ($29,994) ($23,280) ($12,875)

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