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 Table of Contents

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

Chart: Highlights...........................................................................................................................2
2.0 Company Summary......................................................................................................................3
2.1 Company History.......................................................................................................................3
Chart: Past Performance............................................................................................................3
Table: Past Performance............................................................................................................4
3.0 Services.............................................................................................................................................4
3.1 Service Description...................................................................................................................5
3.2 Gig Requests...............................................................................................................................5
3.3 Press Kits......................................................................................................................................6
3.4 Technology...................................................................................................................................7
3.5 Future Services..........................................................................................................................7
4.0 Market Analysis Summary.........................................................................................................8
4.1 Market Segmentation..............................................................................................................8
Table: Market Analysis................................................................................................................8
Chart: Market Analysis (Pie).....................................................................................................9
4.2 Target Market Segment Strategy.......................................................................................9
5.0 Strategy and Implementation Summary...........................................................................10
5.1 Marketing Strategy.................................................................................................................10
5.1.1 Search Engine Positioning...........................................................................................10
5.1.2 Links.....................................................................................................................................11
5.1.3 Banner Ads........................................................................................................................11
5.1.4 Co-Branding......................................................................................................................11
5.2 Competitive Edge....................................................................................................................12
5.3 Sales Strategy..........................................................................................................................13
5.3.1 Sales Forecast..................................................................................................................14
Chart: Sales Monthly.............................................................................................................14
Chart: Sales by Year..............................................................................................................15
Table: Sales Forecast............................................................................................................15
5.3.2 Incentives for Disclosure..............................................................................................15
5.3.3 Corporate Sponsorships...............................................................................................16
5.3.4 Additional Revenue Streams.......................................................................................16
6.0 Management Summary.............................................................................................................16
6.1 Management Team.................................................................................................................16
6.2 Personnel Plan..........................................................................................................................17
Table: Personnel..........................................................................................................................17
7.0 Financial Plan................................................................................................................................17
7.1 Important Assumptions........................................................................................................17
Table: General Assumptions...................................................................................................17
7.2 Break-even Analysis...............................................................................................................18
Chart: Break-even Analysis....................................................................................................18
Table: Break-even Analysis....................................................................................................18
7.3 Projected Profit and Loss.....................................................................................................19
7.3 Projected Profit and Loss.....................................................................................................19

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 Table of Contents

Chart: Gross Margin Monthly.................................................................................................19

Chart: Gross Margin Yearly.....................................................................................................20
Chart: Profit Monthly.................................................................................................................20
Chart: Profit Yearly.....................................................................................................................21
Table: Profit and Loss................................................................................................................21
7.4 Projected Cash Flow...............................................................................................................22
7.4 Projected Cash Flow...............................................................................................................22
Chart: Cash...................................................................................................................................22
Table: Cash Flow.........................................................................................................................23
7.5 Projected Balance Sheet......................................................................................................24
7.5 Projected Balance Sheet......................................................................................................24
Table: Balance Sheet.................................................................................................................24
7.6 Business Ratios........................................................................................................................24
7.6 Business Ratios........................................................................................................................24
Table: Ratios.................................................................................................................................25
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...........................................................................................................................7
Table: Balance Sheet...........................................................................................................................7

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 Gigmasters.com

1.0 Executive Summary

Introduction

The Gigmasters.com (Gigmasters) online booking system was developed to help consumers find
and hire live entertainment for weddings, corporate events, private parties, nightclubs,
fraternity functions, Bar Mitzvahs, grand openings, and other events. The company has built up
a database of over 15,000 musicians. More recently, it has expanded its offerings to include
other entertainment services such as comedians, dancers, caterers, photographers, etc.

Gigmaster's online booking system takes advantage of the Internet's ability to organize and
connect the fragmented marketplace of musicians and entertainers into a searchable database
that is consumer-focused, and easy-to-use.

Gigmasters is an owner-managed company. The two people who run the site are its co-
founders, Kevin H. Kinyon and Michael J. Caldwell. Recently they brought John Sortino onto
their Board of Directors. All three of these gentlemen have extensive experience in Web
development, business development and financial management.

Services

Gigmasters collects a 10% commission fee each time it brokers a transaction between a buyer
and seller of entertainment services. The company collects its fee from the seller. In addition to
booking commissions, Gigmasters earns revenue from corporate sponsorships of its bi-monthly
newsletter. Past sponsors include Amazon.com, Emusic.com, RollingStone.com, and
Bluelight.com.

There are a number of other websites that connect buyers and sellers of services, however only
Gigmasters provides the emphasis on music and entertainment. By doing so, it offers significant
advantages to all of it's customers. For example, only Gigmasters provides online press kits
allowing customers to both hear and see entertainers before they hire them. Also, only
Gigmasters has developed an online bidding system which supplies customers with competitive
bids from the entertainers. None of its competitors do.

In addition to its primary revenue sources of booking commissions and corporate sponsorships,
the company also derives revenue through additional fee-based services it offers its
entertainers. As the company grows and has additional resources, these secondary revenue
streams will begin to take on an increasingly important role.

The Market

Research shows that in the United States, close to $9 billion is spent each year on music and
entertainment. The largest component of this market is the wedding industry. There are 2.3
million weddings each year, with over $3.2 billion spent on music. Other components of the
industry include corporate events, nightclubs, festivals, Bar Mitzvahs, fraternity and sorority
functions, high school proms, country clubs, and hotels.

There are also approximately 13,239 traditional (offline) booking agents in the United States.
They earn $2.4 billion annually. Many have websites, but few, if any, offer the ability to book
directly online. These sites are more like corporate "brochures" and spotlight only a few of their
big-name entertainers with little more than a phone number available for further information.
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Also, these agents traditionally focus on high-end bookings, generally ignoring the vast market
of individuals looking for bands for their weddings, private parties, fraternity dances, corporate
Christmas parties, and high school proms. These types of events make up the Gigmasters
marketplace.

The company will seek to form strategic partnerships with sites such as WeddingChannel.com,
TheKnot.com, iParty.com, and Evite.com, whose customers are planning weddings, parties, and
events. Gigmasters will offer these high traffic sites the opportunity to share in a viable revenue
sharing program, and, in return, Gigmasters will benefit from a steady stream of traffic and
increased revenue.

Financial Considerations

Gigmasters is raising $100,000 (representing 5% equity) for the purposes of expanding its
business and paying office, salary, website, and advertising expenses. The minimum amount
needed to be raised is $70,000.

The company expects to be earning a solid profits by 2003. These estimates are based on
conservative estimates of bookings growth. If the proper funding can be obtained, the company
does not expect any significant cash flow problems.

Chart: Highlights

Highlights

$1,600,000

$1,400,000

$1,200,000
Sales
$1,000,000
Gross Margin
$800,000
Net Profit
$600,000

$400,000

$200,000

$0

2001 2002 2003

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 Gigmasters.com

2.0 Company Summary

Gigmasters is an owned by Kevin H. Kinyon and Michael J. Caldwell, who also oversee the day-
to-day operations of the Gigmasters.com website. Gigmasters.com is an online business.

2.1 Company History

Financial figures for last year's operations are shown below.

Chart: Past Performance

Past Performance
$18,000

$16,000

$14,000

$12,000
Sales
$10,000
Gross
$8,000
Net
$6,000

$4,000

$2,000

$0
1998 1999 2000

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 Gigmasters.com

Table: Past Performance

Past Performance
1998 1999 2000
Sales $0 $0 $17,066
Gross Margin $0 $0 $17,066
Gross Margin % 0.00% 0.00% 100.00%
Operating Expenses $0 $0 $19,435
Collection Period (days) 0 0 0

Balance Sheet
1998 1999 2000

Current Assets
Cash $0 $0 $15,793
Accounts Receivable $0 $0 $1,125
Other Current Assets $0 $0 $0
Total Current Assets $0 $0 $16,918

Long-term Assets
Long-term Assets $0 $0 $1,510
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $0 $0 $1,510

Total Assets $0 $0 $18,428

Current Liabilities
Accounts Payable $0 $0 $0
Current Borrowing $0 $0 $0
Other Current Liabilities (interest free) $0 $0 $0
Total Current Liabilities $0 $0 $0

Long-term Liabilities $0 $0 $4,200

Total Liabilities $0 $0 $4,200

Paid-in Capital $0 $0 $15,657

Retained Earnings $0 $0 ($1,429)
Earnings $0 $0 $0
Total Capital $0 $0 $14,228

Total Capital and Liabilities $0 $0 $18,428

Other Inputs
Payment Days 0 0 30
Sales on Credit $0 $0 $0
Receivables Turnover 0.00 0.00 0.00

3.0 Services

Gigmasters is the medium between live entertainment and the people who hire them. We
provide the booking service to help customers find quality entertainment for any event they
may be having.

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 Gigmasters.com

3.1 Service Description

How the system works:

1. A customer visits the Gigmasters website and types in her ZIP code, the event she is
planning, and the type of entertainment she is seeking.

2. She is immediately furnished with a list of entertainers in her area. She accesses online
press kits where she listens to audio samples, watches video, reads biographies, and views
client testimonials. She then checks off the ones that interest her.

3. The customer then fills out a brief description of her event. This description is referred to
herein as a "gig request."

4. Each entertainer selected by the customer then receives a "gig alert" email describing the
customer's event. The entertainers then each have an opportunity to submit a bid for the
customer's event.

5. Based on the bids received, the customer can then decide which entertainer she wishes to
hire, and may contact the entertainers offline for further information to aid in her decision.

6. The day after the event, a follow-up email is sent to the customer inquiring whether any
groups she contacted were hired. Those that were are then invoiced for an amount equal to
10% of what they earned. This commission is agreed to in advance by all entertainers who
sign up with the Gigmasters website.

3.2 Gig Requests

Whenever a customer completes a request for entertainers, they have created what the
company refers to as a "gig request." This is what the customer fills out after she has selected
which entertainers she would like to contact. This information is logged to the Gigmasters
database, and is immediately forwarded on to the entertainers who were selected. The average
number of customers who will fill out a gig request during their visit is currently 3.5%. This
means that for every 1,000 customers who visit the site, 35 people will complete a gig request.
Management believes it can increase that percentage from 3.5% to 5.0% over the
next year through improved design and layout of the website. By doing so, it will be able to
increase its revenues substantially, independent of any corresponding increase in traffic. In
addition, management will conduct focus groups to study customer behavior on its sites.
Through this, it will discover new ways to lead customers more quickly and easily into filling out
gig requests.

Once the gig request is submitted and verified by Gigmasters, an email is then sent to each
entertainer contacted for the event. This email alerts the entertainer that they have a potential
customer. Upon clicking the hyperlink contained within the email, the entertainer can then see
details about the gig including date, time, location, and description. At this point, the identity of
the customer has not been revealed, thus preventing the entertainer from bypassing our
system and going directly to the customer. Here is an example of the email the entertainer
initially receives: (Discussion Omitted)

At this point, each entertainer that receives the request will have an opportunity to submit a
"bid" to the customer. This bid will indicate the rate the entertainer plans to charge based on
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 Gigmasters.com

the information provided. The consumer starts receiving various bids through email and is in
the position to be able to make an informed decision. At this point she can either hire one of
the entertainers on the spot, or she may follow up with either a phone call or an email.

Out of all the requests Gigmasters receives, the largest component is live bands. This is due in
large part because the company has received the most publicity in this area. It has been
written up in musician magazines (e.g, Gig Magazine, February 2000 "106 Best Websites For
Giggers") as well as wedding magazines (e.g. Bridal Guide, November 2000 "Webbing
Planning"). Gigmasters has established a market niche for itself in this area.

The percentage of gig requests that result in actual bookings is currently 5%. This was achieved
while both founders were working only part-time on the site. The company believes it can
increase this number to 7-8% in a short amount of time once both founders are working full-
time. This will be achieved through improvements to the booking system, as well as better
follow-up on gig requests.

Currently, follow-up on gig requests is done via automated emails, and the company will
supplement this with telephone inquiry. In addition, once broadband becomes more prevalent
in homes around the country, video streaming will improve substantially in quality, and this
should increase the number of customers who are able to make their hiring decision entirely
online. This number is expected to grow to 16.9% of U.S. households by 2003, compared to the
current 3.1% level.

3.3 Press Kits

Gigmasters provides each entertainer with an online press kit containing:

 biography and full description

 color photos
 audio and video samples
 client testimonials
 song lists
 rates and prices
 instrumentation
 musical genre.

The purpose of the press kit is to provide the customer with enough information about the
performer to eliminate the need for an offline press kit to be sent in the mail--a process that
can take several days and can become quickly outdated. Eventually, the audio and video
samples provided in the online press kit will also replace the need for a demo tape to be sent.
The entire demo tape will be accessed online. This will become more plausible once broadband,
or high speed Internet access, becomes more widespread.

There is an additional function of the press kit. The press kit acts as a website or homepage for
those entertainers who don't already have one. Groups are given a Web address. For example:
(Discussion Omitted)

Bands and entertainers can place these URL's on business cards, flyers, brochures, and other
promotional material. Besides helping the musicians, this also provides the added benefit of
free branding of the Gigmasters name by being visible in the URL.

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 Gigmasters.com

Entertainers are provided with usernames and passwords enabling them to update their press
kits whenever necessary. By letting entertainers update this information themselves, it keeps
the information accurate and current, while eliminating the need for Gigmasters employees to
do the updates themselves. While the entertainers are updating their press kits, they also gain
access to their control panel, a special screen showing statistics on their account. This
information includes how often their press kits were viewed by others, as well as in which
categories they were most often found (e.g. blues, top 40, etc...). This control panel also lets
them update billing information, pager numbers, email addresses, category selection, audio &
video samples, and username/passwords.

3.4 Technology

One major component of Gigmasters's service is based on customers being able to view
audio and video samples of each entertainer online. While audio is fairly wide-scale at present,
video streaming is in its earliest stages. Broadband, which is what makes video possible, is
predicted to grow to 16.9% of U.S. households by 2003, compared to the current 3.1% level.
Once video becomes commonplace, it will be increasingly compelling for customers to make
their hiring decisions entirely online without having to revert to the off-line world. This should
dramatically increase the number of bookings and commissions that take place. Overall
improvements to bandwidth, technology, and computing power will all contribute to a more
favorable user experience on the Internet in general, and on Gigmasters specifically.

3.5 Future Services

In the United States, approximately $6.38 trillion is spent each year in the services sector.
Gigmasters recognizes the possibility that it could apply its online bookings system to other
segments of the service industry. It is currently beta testing categories including: Home &
Garden, Wellness, Instructors, and Legal and Financial.

Management's strategy has been to focus all energies on the current revenue streams, which
are:

1. booking commissions
2. corporate sponsorships
3. merchant services

We recognize the fact that there may be other revenue streams that can be developed in the
future. With a loyal database of 15,000+ entertainers, there will opportunities to up-sell them
additional products and services in the future, but these have not been factored into revenue
projections at this point.

Gigmasters has begun to test its booking system on services outside of the area of
entertainment. It has discovered that the same system that a person uses to hire a band or DJ
could, with some modification, be used to hire a painter or a math tutor. In the United States,
approximately $6.38 trillion is spent each year in the services sector, and Gigmasters has the
potential to expand its reach into this vast market. Some of the new categories it has tested
are listed below: (discussion omitted).

By expanding into these ares, Gigmasters could increase its market exponentially. It would also
provide people with a reason to make repeat visits. For example, a couple could use Gigmasters
to book a band for their wedding. Three months later they might return to hire a painter. Two
months following, they could come in search of a financial planner. At present, the emphasis

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 Gigmasters.com

continues to be in the area of entertainment. Expanding into these new areas, however, could
greatly increase revenue and profitability.

4.0 Market Analysis Summary

Research shows that in the United States, close to $9 billion per year is spent on live music and
entertainment services. The largest component of this is the wedding industry.

On the supply side, there are over 124,520 professional musicians and entertainers earning a
total of $13 billion per year. This does not include the vast number of amateur musicians, many
of whom make up the company's database. The company has targeted this segment
aggressively, and has also begun to target the 91,191 caterers and 65,395 photographers who
earn $3.4 billion and $9.3 billion respectively.

4.1 Market Segmentation

The components of the entertainment market that Gigmasters is targeting include:

 Weddings
 Corporate Events/Conventions
 Nightclubs/Bars/Restaurants
 Bar/Bat Mitzvahs
 Festivals
 Vacation & Resort Entertainment
 Fraternity/Sorority Dances & Parties
 High School Proms/Dances
 Country Club Entertainment
 Hotel Entertainment.

Table: Market Analysis

Market Analysis
2001 2002 2003 2004 2005
Potential Customers Growth CAGR
Weddings 4% 2,300,000 2,396,600 2,497,257 2,602,142 2,711,432 4.20%
Bar/Bat Mitzvahs 3% 73,000 75,190 77,446 79,769 82,162 3.00%
Nightclubs 4% 52,900 54,804 56,777 58,821 60,939 3.60%
Other 5% 750,000 787,500 826,875 868,219 911,630 5.00%
Total 4.35% 3,175,900 3,314,094 3,458,355 3,608,951 3,766,163 4.35%

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 Gigmasters.com

Chart: Market Analysis (Pie)

Market Analysis (Pie)

Weddings

Bar/Bat Mitzvahs

Nightclubs

Other

4.2 Target Market Segment Strategy

Weddings

The wedding industry makes up the largest percentage of Gigmasters's target market, and
most of its business is generated from this segment. There are 2.3 million weddings in the
United States each year. It is a $39.1 billion industry with $3.2 billion (8%) spent annually on
music, $16.0 billion (41%) spent on catering, and $2.9 billion (7.4%) spent on photography.

Corporate Events

The corporate events industry includes, among other things, promotional events, conventions,
expositions, and meetings. It is an $82 billion industry with 4.5%, or $3.76 billion, spent on
entertainment. It is estimated that this industry will grow at a rate of 4.2% per year, paralleling
the current boom in the hospitality industry. Gigmasters will target this segment aggressively
and seek to become the definitive music and entertainment source for corporate event planners
and industry professionals. The company will continue to benefit from the continued growth in
the number of lavish promotional events held by corporations each year.

Bars/Nightclubs/Restaurants

This segment of the market includes bars, nightclubs, taverns, pubs, and cocktail lounges.
There are approximately 52,900 such establishments in the United States. If the average
budget for live music is $400 per week, it is a $1.1 billion dollar industry. In addition, there are
approximately 100,000 restaurants in the United States, many of which feature live music. This
sector should register annual growth of 3.6%.

Bar and Bat Mitzvahs

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 Gigmasters.com

There are approximately 73,300 Bar and Bat Mitzvahs in the United States each year. Families
spend an average of $20,000 for the event, making it a $1.5 billion industry. Approximately
5%, or $73 million is spent on music, 7.5%, or $110 million is spent on photography, and
37.5%, or $549 million is spent on catering.

5.0 Strategy and Implementation Summary

Gigmasters collects a 10% commission each time it brokers a transaction between a buyer and
seller of entertainment services. This is referred to as a "booking." Since it instituted its current
booking system, Gigmasters successfully booked over 100 gigs at an average commission of
$100. This was accomplished with no major advertising, and with the founders working only
part-time on the business. The company predicts that in the year 2001, when the company is
funded and its founders are working full-time, bookings will grow by 20% per month, and by
October of 2001 will be averaging approximately 145 bookings per month with commissions
each month totaling $14,000. Gigmasters collects the commission from the seller (the
entertainer). Gigmasters does not charge the customer (i.e the buyer) anything to use its
service.

Gigmasters has a transaction-based revenue model similar to sites such as eBay.com and
HotelReservationNetwork.com. These companies earn money on each transaction they broker,
and are among the few profitable sites on the Internet.

In order to determine the best revenue model, the company tested several payment scenarios.
Initially the entertainers were charged a flat rate to be listed on the site. Even with a
substantial free-trial period, however, there was a reluctance to pay in advance for a service
largely unproven. The company then introduced a mixed payment option in which entertainers
could choose between a flat-rate fee structure or a commission-based plan.

The majority of entertainers responded positively to the 10% commission plan. Follow-up
surveys indicated they favored a system not requiring them to pay any money up front. The
company implemented the 10% commission plan exclusively, and this has generated the most
revenue.

5.1 Marketing Strategy

The first and most important factor is getting people to visit the site. The website is currently
averaging 200 visitors a day to the main page of its site (this does not include hits to interior
pages of the site). This number is projected to grow by 20% per month over the next year, and
then 10% per month in the second year, and 5% per month in year three. Traffic is essential
because it leads to gig requests, which lead to bookings, which lead to commissions.

5.1.1 Search Engine Positioning

Most of Gigmasters' traffic comes from search engines like Yahoo.com, Excite.com, Hotbot.com,
and AskJeeves.com. Search engines direct users to sites based on keywords. The company has
been able to achieve favorable positioning for keywords including "booking," "agents," "music,"
"wedding," "planning," and "party." It has accomplished this by optimizing its code, utilizing
search-engine submission tools like Submit-It, and by contacting the larger sites directly when
necessary.

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5.1.2 Links

Because of its value as a resource to musicians, Gigmasters has been listed on numerous
musician websites in their ‘Recommended Links' sections. For example, Harmony Central, a
popular destination for musicians, has Gigmasters listed as a recommended site for bands.
Other musician sites displaying Gigmasters as a recommended link include: The Music Scene,
the Professional Music Forum, and the Indie Journal. Links are a vital form of free advertising,
and frequently occur without notice or request. Others need to be actively pursued. Increasing
the number of sites which link back to Gigmasters will be a major focus of the company's
marketing effort. Often it is a process of browsing from site to site looking for opportunities to
register the company's link. It is estimated that approximately 29% of the site's current traffic
is originating from links from other websites. In addition to links that target musicians, the
company will aggressively pursue links that list Gigmasters as a resource for brides/grooms,
corporate event planners, and club owners. These links should have a substantial impact on the
site's overall traffic.

Also, many of the musicians and entertainers have put a link to Gigmasters from their main
website. This is accomplished by a logo provided to each artist upon signing up. The
hyperlinked logo identifies the entertainer as "Officially Registered With Gigmasters." This lends
the group increased credibility by being associated with a network of entertainers such as
Gigmasters. At the same time, it provides a form of free advertising for the company.

5.1.3 Banner Ads

Gigmasters currently relies on banner ads to supply it with 5% of its traffic. So for example, out
of the 200 visitors it gets per day to its homepage, 10 will come as a result of seeing a banner
on another site (the rest of the traffic comes from search engines, word of mouth, being
mentioned in articles, etc).

 Management has found that it can get a 1% click-through rate on its banner ads. For every
100 times a Gigmasters banner ad appears on another site, this will result in 1 visitor to the
site.

 Each month, management has purchased increasing amounts of banners ads through the B-
Central Network. The cost of banner ads is approximately $12 CPM (cost per thousand). Ads
on more prominent sites cost $20-30 CPM.

5.1.4 Co-Branding

The company will seek to form strategic partnerships with sites such as WeddingChannel.com,
TheKnot.com, iParty.com, and Evite.com, whose customers are planning weddings, parties, and
events. Gigmasters will offer these high-traffic sites the opportunity to share in a viable
revenue sharing program, and, in return, Gigmasters will benefit from a steady stream of traffic
and increased revenue.

In this type of co-branding situation, a link or graphic is placed on the partner's site with words
to the effect of "Click Here To Find a Band or D.J." When a user clicks this link, it takes them
from the partner's site to Gigmasters. The page will have a look and feel which mimics the
partner's design but which lives on Gigmasters' servers. The user would search just as if he/she
came to Gigmasters directly. Then end result is a revenue share between the partner site and
Gigmasters. The partner site would be providing the traffic, while Gigmasters would be

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 Gigmasters.com

providing the revenue-generating booking system. Gigmasters would handle the billing and
would distribute a percentage of the revenue to the partner company.

There will likely be additional costs to the company as a result of a co-brand. The increase in
traffic may require the purchase of additional servers to handle the volume. In addition,
Gigmasters will need to hire one or more employees to handle the increased customer service
and billing responsibilities.

5.2 Competitive Edge

The closest competitors to Gigmasters are (discussion omitted). These sites all connect buyers
and sellers of services, however only Gigmasters provides the emphasis on music and
entertainment. By doing so, it offers significant advantages to all of it's customers. For
example, only Gigmasters provides online press kits allowing customers to both hear and see
entertainers before they hire them. Also, only Gigmasters has developed an online bidding
system which supplies customers with competitive bids from the entertainers. None of its
competitors do.

The second tier of competition comes from wedding sites such as TheKnot.com and
ModernBride.com, which focus on providing content on wedding planning, but have also a
section providing names and addresses of local merchants. Again, because the information they
provide is so limited, it is not any more useful than a phone book.

There are also approximately 13,239 traditional (offline) booking agents in the United States.
They earn $2.4 billion annually. Many have websites, but few, if any, offer the ability to book
directly online. These sites are more like corporate "brochures" and spotlight only a few of their
big-name entertainers with little more than a phone number available for further information.
Also, these agents traditionally focus on high-end bookings, generally ignoring the vast market
of individuals looking for bands for their weddings, private parties, fraternity dances, corporate
Christmas parties, and high school proms. These types of events make up the Gigmasters
marketplace.

It is worth clarifying that companies not competitors to Gigmasters are MP3.com, Napster.com,
and Emusic.com. These are sites where customers find downloadable music from thousands of
bands. Even though Gigmasters does have a large database of groups, this is not part of the
company's business model. The user experience at these music sites is geared toward listening
to music, rather than being specifically tailored to hiring entertainment. From the moment a
person arrives at Gigmasters, she knows that the purpose of the site is to help her find and hire
live entertainment for her next event.

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5.3 Sales Strategy

Once visitors have reached our site, we must convince them to book entertainment through
Gigmaster.com. There are three challenges here:

Helping the customer find the right entertainer

Our internal search engine is combined with audio and streaming video samples so customers
can 'audition' local performers from the comfort of their living rooms.

Gaining the customer's trust

Co-branding, as described above, will give the site legitimacy by linking it to other well-known
and trusted websites. In addition, we have completed processes to be marked as a secure site
for handling sensitive customer data and billing.

Making sure that our listed entertainers respond to gig requests

These gigs must be profitable for performers, or they will stop responding to gig requests. We
will limit each customer to choosing 3 entertainers of each type per event (for example, three
bands, three photographers, etc.) in their gig request. Each gig request thus represents a 1 in 3
chance for that entertainer to get a gig.

In addition, since each gig request and bid in response are routed through our system, we will
be able to keep tabs on how the matches are going.

 Any entertainer who repeatedly fails to respond to gig requests will be contacted to
determine whether there are problems in our listings of their services, or the types of
requests they are receiving. Those who are simply too busy to accept gigs will be removed
from the listings.
 Any entertainer who repeatedly submits bids and fails to win contracts will be contacted to
determine the problem. Are they submitting bids far out of line with their local competition?

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5.3.1 Sales Forecast

Overall, there are three main variables in the formula that determine the volume of bookings
that Gigmasters will be able to generate:

 The number of customers who visit Gigmasters each day.

 The percentage of those customers who fill out gig requests.
 The percentage of gig requests which result in actual bookings.

Jul Aug Sep Oct Nov Dec

The day after an event takes place, the company contacts the customer. The purpose is to: a)
inquire about the level of satisfaction with the performance, and, b) to discover the rate the
entertainer charged to the customer. Once the amount is revealed, an invoice is distributed to
the entertainer for an amount equal to 10% of his/her earnings.

The invoice is sent both online and offline. An entertainer has 30 days to remit payment, and
may pay online with a credit card or may send a check. If payment is not received within 30
days, his/her online press kit is de-activated. Press kits are re-activated once payment is
Jan Feb Mar Apr May Jun
received. To date, the company has collected on 93% of its bookings.

Because Gigmasters has online billing capabilities, the company will offer the entertainers the
option of having commissions automatically billed directly to their credit cards. This will shorten
the number of days it takes the company to get paid, and will be more convenient for
entertainers.

Chart: Sales Monthly

Sales Monthly

$16,000

$14,000

$12,000

$10,000 Booking Commissions

$8,000 Other

$6,000

$4,000

$2,000

$0

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 Gigmasters.com

Chart: Sales by Year

Sales by Year

$1,600,000

$1,400,000

$1,200,000
Booking Commissions
$1,000,000
Other
$800,000

$600,000

$400,000

$200,000

$0
2001 2002 2003

Table: Sales Forecast

Sales Forecast
2001 2002 2003
Sales
Booking Commissions $83,017 $458,227 $1,604,858
Other $6,000 $12,000 $18,000
Total Sales $89,017 $470,227 $1,622,858

Direct Cost of Sales 2001 2002 2003

Booking Commissions $0 $0 $0
Other $0 $0 $0
Subtotal Direct Cost of Sales $0 $0 $0

5.3.2 Incentives for Disclosure

In order to encourage entertainers to accurately disclose the amount they have been paid for
their performances, Gigmasters offers an incentive program. Essentially, the more business an
entertainer books through Gigmasters, the higher they are listed in search results. For example,
a bride who searches for jazz quartets in Miami, Florida will see those groups listed first who
have booked the most total dollars through Gigmasters. By instituting this policy, the company
rewards entertainers who book through its service, and gives them priority positioning.
Response from entertainers has been positive, and those who have seen results from its service
have shown a willingness to disclose the amounts they were paid in order to not jeopardize
their likelihood of getting additional bookings in the future.

Because Gigmasters has over 15,000 entertainer press kits, it behooves entertainers to
maintain a high position in the categories where they are listed. This is the incentive for them
to disclose the dollar amounts they receive through the site's booking process.

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5.3.3 Corporate Sponsorships

Gigmasters also derives revenue from sponsorships of its bi-monthly newsletter. This
newsletter currently goes out to approximately 8,000 entertainers who have valid email
addresses in the company's database. Because of the large number of musicians receiving the
newsletter, it is an effective means of advertising for music & entertainment companies. Past
sponsors include: Amazon.com, Emusic.com, RollingStone.com, and Bluelight.com. These
companies have paid as much as $1,000 per mailing and receive a paragraph of text placed at
the top of the email. Revenue from sponsorships will continue to increase as the company's
database grows. Recently, Gigmasters added an additional mailing sent each month to the
brides/grooms, event planners, and club owners who have used its service. Potential
advertisers for this newsletter include party-planning companies like Evite.com and iParty.com,
as well as wedding sites such as TheKnot.com and ModernBride.com.

5.3.4 Additional Revenue Streams

In addition to its primary revenue sources of booking commissions and corporate sponsorships,
the company also derives revenue through additional fee-based services it offers its
entertainers. This includes fees for digitizing entertainer's music into RealAudio or MP3 format,
scanning press kit photos, and the selling of musician CDs on consignment. As the company
grows and has additional resources, these secondary revenue streams will begin to take on an
increasingly important role.

6.0 Management Summary

Gigmasters is an owner-managed company. The two people who run the site are its co-
founders, Kevin H. Kinyon and Michael J. Caldwell. Recently they brought John Sortino on to
their Board of Directors. Mr. Sortino, founder of Vermont Teddy Bear, will advise the company
on business and financing strategies, and will be compensated with stock options.

6.1 Management Team

Mr. Caldwell has worked extensively in the New Media industry for the last four years. He is a
Microsoft Certified Professional with expertise in database design and Web development. He has
consulted to numerous high-profile websites including SmartMoney.com, Refer-it.com,
TheSquare.com, as well as for the sites of George and Premiere magazines. Prior to his
involvement in New Media, Michael worked in the International Equity department at Scudder,
Stevens, and Clark. He studied Viola performance at Indiana University, and graduated with a
bachelor's degree in Economics in 1992.

Mr. Kinyon launched Gigmasters in February 1997. Previously, Mr. Kinyon was a financial
management consultant for five years, most recently with Telekurs, USA. In 1989, Mr. Kinyon
earned his B.A. with Honors from Pace University with a double major in Literature and
Communications. He starred in the 1996 award-winning short film "On The Nod," has been a
guest speaker at Trinity University in Dublin, Ireland, and is a frequent contributor to Internet
industry publications.

Mr. Sortino founded the Vermont Teddy Bear Company in 1981 as a kiosk on Church Street in
Burlington, Vermont and oversaw its growth as President and Chief Executive Officer, through
its IPO in 1993, until 1995. Vermont Teddy Bear was the third fastest growing IPO of 1993,
with a market capitalization that year of nearly $100 million. The Vermont Teddy Bear and Mr.
Sortino were awarded "Best Company in America" by the National Foundation of Business and

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Dun & Bradstreet in 1994. That same year, the company was named "Best Customer Service in
New England" by SOCAP and also the "Yankee Award" for best public relations in its region
(New York and New England). In 1995, Mr. Sortino was recognized as one of "America's Top
100 Marketing Stars" in Advertising Age magazine (July 1995). Inc. magazine recognized the
Vermont Teddy Bear Company as one of the country's fastest growing companies in 1991,
1992, and 1993 (ranking 88th, 85th, and 50th, respectively). Mr. Sortino has appeared in many
magazine articles and on business and news programs, including interviews on CNN and ABC.
He has given over 200 radio interviews. In 1999, Mr. Sortino authored Being a Successful
Entrepreneur, published by MacMillan Publishing Company. Mr. Sortino was a founder and CEO
of the Chicago Bicycle Company from 1994 to 1997. He was a founder of, and has been CEO of
American Performance Products since 1997.

6.2 Personnel Plan

Our projected payroll expenses are laid out in the following table.

Table: Personnel

Personnel Plan
2001 2002 2003
Payroll $104,796 $224,784 $246,780
Other $0 $0 $0
Total People 0 0 0

Total Payroll $104,796 $224,784 $246,780

7.0 Financial Plan

The following sections describe the financial position of Gigmasters.

7.1 Important Assumptions

Our basic financial accounting assumptions are outlined below.

Table: General Assumptions

General Assumptions
2001 2002 2003
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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7.2 Break-even Analysis

The Break-even Analysis below demonstrates how much Gigmasters needs to sell every month
to make a profit.

Chart: Break-even Analysis

Break-even Analysis
$9,000

$6,000

$3,000

$0

($3,000)

($6,000)

($9,000)

($12,000)
$0 $4,000 $8,000 $12,000 $16,000 $20,000
$2,000 $6,000 $10,000 $14,000 $18,000 $22,000

Table: Break-even Analysis

Break-even Analysis

Monthly Revenue Break-even $12,512

Assumptions:
Average Percent Variable Cost 0%
Estimated Monthly Fixed Cost $12,512

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7.3 Projected Profit and Loss

The profit and loss projections in the chart and table below present the key increase in sales,
profits, and gross margin.

The company estimates it will not achieve profitability in the first year, especially since we
project the need to hire two additional full-time employees late in the year to assist with
marketing and administrative responsibilities. Their goals will be to increase overall traffic to
the site, increase the percentage of customers who fill out gig requests and increase the
percentage of gig requests that result in bookings.

Chart: Gross Margin Monthly

Gross Margin Monthly

$16,000

$14,000

$12,000

$10,000

$8,000

$6,000

$4,000

$2,000

$0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

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 Gigmasters.com

Chart: Gross Margin Yearly

Gross Margin Yearly

$1,600,000

$1,400,000

$1,200,000

$1,000,000

$800,000

$600,000

$400,000

$200,000

$0
2001 2002 2003

Chart: Profit Monthly

Profit Monthly
$0

($1,000)

($2,000)

($3,000)

($4,000)

($5,000)

($6,000)

($7,000)
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

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 Gigmasters.com

Chart: Profit Yearly

Profit Yearly

$900,000

$800,000

$700,000

$600,000

$500,000

$400,000

$300,000

$200,000

$100,000

$0

2001 2002 2003

Table: Profit and Loss

Pro Forma Profit and Loss

2001 2002 2003
Sales $89,017 $470,227 $1,622,858
Direct Cost of Sales $0 $0 $0
Other $0 $0 $0
Total Cost of Sales $0 $0 $0

Gross Margin $89,017 $470,227 $1,622,858

Gross Margin % 100.00% 100.00% 100.00%

Expenses
Payroll $104,796 $224,784 $246,780
Sales and Marketing and Other Expenses $28,388 $93,873 $220,259
Depreciation $0 $0 $0
Rent $16,960 $33,360 $36,000
Payroll Taxes $0 $0 $0
Other $0 $0 $0

Total Operating Expenses $150,144 $352,017 $503,039

Profit Before Interest and Taxes ($61,127) $118,210 $1,119,819

EBITDA ($61,127) $118,210 $1,119,819
Interest Expense $70 $0 $0
Taxes Incurred $0 $29,553 $284,621

Net Profit ($61,197) $88,658 $835,198

Net Profit/Sales -68.75% 18.85% 51.46%

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 Gigmasters.com

7.4 Projected Cash Flow

The chart and table below show the projected cash flow for the company.

Chart: Cash

Cash
$70,000

$60,000

$50,000

$40,000
Net Cash Flow
$30,000 Cash Balance

$20,000

$10,000

$0

Jan Mar May Jul Sep Nov

Feb Apr Jun Aug Oct Dec

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 Gigmasters.com

Table: Cash Flow

Pro Forma Cash Flow

2001 2002 2003
Cash Received

Cash from Operations

Cash Sales $89,017 $470,227 $1,622,858
Cash from Receivables $1,125 $0 $0
Subtotal Cash from Operations $90,142 $470,227 $1,622,858

Additional Cash Received

Sales Tax, VAT, HST/GST Received $0 $0 $0
New Current Borrowing $0 $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 $70,000 $0 $0
Subtotal Cash Received $160,142 $470,227 $1,622,858

Expenditures 2001 2002 2003

Expenditures from Operations

Cash Spending $104,796 $224,784 $246,780
Bill Payments $38,633 $150,684 $509,310
Subtotal Spent on Operations $143,429 $375,468 $756,090

Additional Cash Spent

Sales Tax, VAT, HST/GST Paid Out $0 $0 $0
Principal Repayment of Current Borrowing $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0
Long-term Liabilities Principal Repayment $4,200 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $5,000 $25,000
Dividends $0 $0 $0
Subtotal Cash Spent $147,629 $380,468 $781,090

Net Cash Flow $12,513 $89,759 $841,768

Cash Balance $28,306 $118,065 $959,832

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 Gigmasters.com

7.5 Projected Balance Sheet

The following Balance Sheet outlines the key assets and liabilities for Gigmasters.

Table: Balance Sheet

Pro Forma Balance Sheet

2001 2002 2003
Assets

Current Assets
Cash $28,306 $118,065 $959,832
Accounts Receivable $0 $0 $0
Other Current Assets $0 $0 $0
Total Current Assets $28,306 $118,065 $959,832

Long-term Assets
Long-term Assets $1,510 $6,510 $31,510
Accumulated Depreciation $0 $0 $0
Total Long-term Assets $1,510 $6,510 $31,510
Total Assets $29,816 $124,575 $991,342

Liabilities and Capital 2001 2002 2003

Current Liabilities
Accounts Payable $6,785 $12,886 $44,456
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $6,785 $12,886 $44,456

Long-term Liabilities $0 $0 $0
Total Liabilities $6,785 $12,886 $44,456

Paid-in Capital $85,657 $85,657 $85,657

Retained Earnings ($1,429) ($62,626) $26,031
Earnings ($61,197) $88,658 $835,198
Total Capital $23,031 $111,688 $946,887
Total Liabilities and Capital $29,816 $124,575 $991,342

Net Worth $23,031 $111,688 $946,887

7.6 Business Ratios

The following table presents important business ratios for the business services industry, as
determined by the Standard Industry Classification Index (SIC) code 7389, Business Services,
NEC.

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Table: Ratios

Ratio Analysis
2001 2002 2003 Industry Profile
Sales Growth 421.59% 428.24% 245.12% 8.20%

Percent of Total Assets

Accounts Receivable 0.00% 0.00% 0.00% 26.30%
Other Current Assets 0.00% 0.00% 0.00% 44.20%
Total Current Assets 94.94% 94.77% 96.82% 74.30%
Long-term Assets 5.06% 5.23% 3.18% 25.70%
Total Assets 100.00% 100.00% 100.00% 100.00%

Current Liabilities 22.76% 10.34% 4.48% 49.00%

Long-term Liabilities 0.00% 0.00% 0.00% 13.80%
Total Liabilities 22.76% 10.34% 4.48% 62.80%
Net Worth 77.24% 89.66% 95.52% 37.20%

Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 100.00% 100.00% 100.00% 0.00%
Selling, General & Administrative Expenses 192.29% 88.32% 50.53% 81.40%
Advertising Expenses 19.98% 16.71% 12.36% 1.70%
Profit Before Interest and Taxes -68.67% 25.14% 69.00% 2.10%

Main Ratios
Current 4.17 9.16 21.59 1.49
Quick 4.17 9.16 21.59 1.17
Total Debt to Total Assets 22.76% 10.34% 4.48% 62.80%
Pre-tax Return on Net Worth -265.72% 105.84% 118.26% 4.20%
Pre-tax Return on Assets -205.25% 94.89% 112.96% 11.30%

Additional Ratios 2001 2002 2003

Net Profit Margin -68.75% 18.85% 51.46% n.a
Return on Equity -265.72% 79.38% 88.20% n.a

Activity Ratios
Accounts Receivable Turnover 0.00 0.00 0.00 n.a
Collection Days 0 0 0 n.a
Accounts Payable Turnover 6.69 12.17 12.17 n.a
Payment Days 27 23 19 n.a
Total Asset Turnover 2.99 3.77 1.64 n.a

Debt Ratios
Debt to Net Worth 0.29 0.12 0.05 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a

Liquidity Ratios
Net Working Capital $21,521 $105,178 $915,376 n.a
Interest Coverage -873.24 0.00 0.00 n.a

Additional Ratios
Assets to Sales 0.33 0.26 0.61 n.a
Current Debt/Total Assets 23% 10% 4% n.a
Acid Test 4.17 9.16 21.59 n.a
Sales/Net Worth 3.87 4.21 1.71 n.a
Dividend Payout 0.00 0.00 0.00 n.a

Page 25
 Appendix

Table: Sales Forecast

Sales Forecast
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales
Booking Commissions 0% $2,097 $2,517 $3,020 $3,624 $4,349 $5,219 $6,263 $7,516 $9,019 $10,822 $12,987 $15,584
Other 0% $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Total Sales $2,597 $3,017 $3,520 $4,124 $4,849 $5,719 $6,763 $8,016 $9,519 $11,322 $13,487 $16,084

Direct Cost of Sales Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Booking Commissions $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
Subtotal Direct Cost of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Page 1
 Appendix

Table: Personnel

Personnel Plan
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Payroll 0% $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $12,733 $12,733
Other 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total People 0 0 0 0 0 0 0 0 0 0 0 0

Total Payroll $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $12,733 $12,733

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% 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

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Sales $2,597 $3,017 $3,520 $4,124 $4,849 $5,719 $6,763 $8,016 $9,519 $11,322 $13,487 $16,084
Direct Cost of Sales $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 Cost of Sales $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Gross Margin $2,597 $3,017 $3,520 $4,124 $4,849 $5,719 $6,763 $8,016 $9,519 $11,322 $13,487 $16,084
Gross Margin % 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%

Expenses
Payroll $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $12,733 $12,733
Sales and Marketing and Other $1,149 $1,239 $1,347 $1,677 $1,832 $2,018 $2,242 $2,510 $2,833 $3,219 $3,883 $4,439
Expenses
Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Rent $580 $580 $580 $580 $580 $580 $580 $2,580 $2,580 $2,580 $2,580 $2,580
Payroll Taxes 20% $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 $9,662 $9,752 $9,860 $10,190 $10,345 $10,531 $10,755 $13,023 $13,346 $13,732 $19,196 $19,752

Profit Before Interest and Taxes ($7,065) ($6,735) ($6,340) ($6,066) ($5,496) ($4,812) ($3,992) ($5,007) ($3,827) ($2,410) ($5,709) ($3,668)
EBITDA ($7,065) ($6,735) ($6,340) ($6,066) ($5,496) ($4,812) ($3,992) ($5,007) ($3,827) ($2,410) ($5,709) ($3,668)
Interest Expense $35 $35 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Taxes Incurred $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Net Profit ($7,100) ($6,770) ($6,340) ($6,066) ($5,496) ($4,812) ($3,992) ($5,007) ($3,827) ($2,410) ($5,709) ($3,668)
Net Profit/Sales -273.39% -224.40% -180.11% -147.09% -113.34% -84.14% -59.03% -62.46% -40.20% -21.29% -42.33% -22.81%

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 $2,597 $3,017 $3,520 $4,124 $4,849 $5,719 $6,763 $8,016 $9,519 $11,322 $13,487 $16,084
Cash from Receivables $562 $562 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash from Operations $3,159 $3,579 $3,520 $4,124 $4,849 $5,719 $6,763 $8,016 $9,519 $11,322 $13,487 $16,084

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 $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 $0 $0 $70,000 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Cash Received $3,159 $3,579 $73,520 $4,124 $4,849 $5,719 $6,763 $8,016 $9,519 $11,322 $13,487 $16,084

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

Expenditures from Operations

Cash Spending $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $7,933 $12,733 $12,733
Bill Payments $59 $1,767 $1,856 $1,938 $2,262 $2,418 $2,605 $2,898 $5,101 $5,426 $5,821 $6,482
Subtotal Spent on Operations $7,992 $9,700 $9,789 $9,871 $10,195 $10,351 $10,538 $10,831 $13,034 $13,359 $18,554 $19,215

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 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Liabilities Principal Repayment $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Long-term Liabilities Principal Repayment $0 $0 $4,200 $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 $7,992 $9,700 $13,989 $9,871 $10,195 $10,351 $10,538 $10,831 $13,034 $13,359 $18,554 $19,215

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Net Cash Flow ($4,833) ($6,121) $59,531 ($5,747) ($5,346) ($4,632) ($3,775) ($2,815) ($3,515) ($2,037) ($5,067) ($3,131)
Cash Balance $10,961 $4,840 $64,370 $58,623 $53,277 $48,645 $44,870 $42,055 $38,540 $36,503 $31,436 $28,306

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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 $15,793 $10,961 $4,840 $64,370 $58,623 $53,277 $48,645 $44,870 $42,055 $38,540 $36,503 $31,436 $28,306
Accounts Receivable $1,125 $562 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Current Assets $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Current Assets $16,918 $11,523 $4,840 $64,370 $58,623 $53,277 $48,645 $44,870 $42,055 $38,540 $36,503 $31,436 $28,306

Long-term Assets
Long-term Assets $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510
Accumulated Depreciation $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Long-term Assets $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510 $1,510
Total Assets $18,428 $13,033 $6,350 $65,881 $60,134 $54,787 $50,155 $46,380 $43,565 $40,050 $38,013 $32,946 $29,816

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

Current Liabilities
Accounts Payable $0 $1,705 $1,792 $1,863 $2,182 $2,332 $2,511 $2,728 $4,920 $5,233 $5,606 $6,248 $6,785
Current Borrowing $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other Current Liabilities $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Current Liabilities $0 $1,705 $1,792 $1,863 $2,182 $2,332 $2,511 $2,728 $4,920 $5,233 $5,606 $6,248 $6,785

Long-term Liabilities $4,200 $4,200 $4,200 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

Total Liabilities $4,200 $5,905 $5,992 $1,863 $2,182 $2,332 $2,511 $2,728 $4,920 $5,233 $5,606 $6,248 $6,785

Paid-in Capital $15,657 $15,657 $15,657 $85,657 $85,657 $85,657 $85,657 $85,657 $85,657 $85,657 $85,657 $85,657 $85,657
Retained Earnings ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429) ($1,429)
Earnings $0 ($7,100) ($13,870) ($20,210) ($26,276) ($31,772) ($36,584) ($40,576) ($45,583) ($49,410) ($51,820) ($57,529) ($61,197)
Total Capital $14,228 $7,128 $358 $64,018 $57,952 $52,456 $47,644 $43,652 $38,645 $34,818 $32,408 $26,699 $23,031
Total Liabilities and Capital $18,428 $13,033 $6,350 $65,881 $60,134 $54,787 $50,155 $46,380 $43,565 $40,050 $38,013 $32,946 $29,816

Net Worth $14,228 $7,128 $358 $64,018 $57,952 $52,456 $47,644 $43,652 $38,645 $34,818 $32,408 $26,699 $23,031

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