Fire Fountain Grille

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This sample business plan has been made available to users of Business Plan Pro®, business planning software published by Palo Alto Software. Names, loc ations and numbers may have been c hanged, and substantial portions of text from the original plan may have been omitted to preserve confidentiality and proprietary information. You are welcome to use this plan as a starting point to create your own, but you do not have permission to resell, reproduce, publish, distribute or even c opy this plan as it exists here. Requests for reprints, ac ademic use, and other dissemination of this sample plan should be emailed to the marketing department of Palo Alto Software at [email protected]. For product information visit our Website: www.paloalto.com or call: 1-800-229-7526.

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Table of Contents 1.0 Executive Summary.............................................................................................................................1 Chart: Highlights ......................................................................................................................1 1.1 Objectives ...................................................................................................................................1 1.2 Mission........................................................................................................................................2 1.3 Keys to Success ........................................................................................................................2 2.0 Company Summary.............................................................................................................................2 2.1 Company Ownership .................................................................................................................2 2.2 Start-up Summary ......................................................................................................................3 Chart: Start-up .........................................................................................................................3 Table: Start-up .........................................................................................................................4 2.3 Company Locations and Facilities ..........................................................................................5 3.0 Products and Services........................................................................................................................5 3.1 Competitive Comparison..........................................................................................................5 3.2 Product and Service Description .............................................................................................6 3.2.1 Menu ...............................................................................................................................7 4.0 Market Analysis Summary..................................................................................................................9 4.1 Market Segmentation..............................................................................................................11 Chart: Market Analysis (Pie)................................................................................................11 Table: Market Analysis .........................................................................................................12 4.2 Target Market Segment Strategy...........................................................................................13 4.2.1 Market Trends .............................................................................................................13 4.2.2 Market Growth .............................................................................................................14 4.2.3 Market Needs ..............................................................................................................14 4.3 Service Business Analysis .....................................................................................................14 4.3.1 Competition and Buying Patterns .............................................................................14 4.3.2 Main Competitors .......................................................................................................15 4.3.3 Business Participants.................................................................................................15 5.0 Strategy and Implementation Summary..........................................................................................15 5.1 Competitive Edge....................................................................................................................15 5.2 Marketing Strategy ..................................................................................................................16 5.2.1 Positioning Statement ................................................................................................16 5.2.2 Pricing Strategy...........................................................................................................16 5.2.3 Promotion Strategy.....................................................................................................16 5.2.4 Marketing Programs ...................................................................................................17 5.3 Sales Strategy..........................................................................................................................17 5.3.1 Sales Forecast ............................................................................................................17 Table: Sales Forecast.................................................................................................18 Chart: Sales Monthly ...................................................................................................18 Chart: Sales by Year ...................................................................................................19 5.4 Strategic Alliances...................................................................................................................19 5.5 Milestones ................................................................................................................................19 Table: Milestones..................................................................................................................20 6.0 Web Plan Summary ..........................................................................................................................21 6.1 Website Marketing Strategy...................................................................................................21 6.2 Development Requirements ...................................................................................................21 7.0 Management Summary ....................................................................................................................21 7.1 Personnel Plan.........................................................................................................................22 Page 1

Table of Contents Table: Personnel ...................................................................................................................23 8.0 Financial Plan ....................................................................................................................................24 8.1 Start-up Funding ......................................................................................................................24 Table: Start-up Funding........................................................................................................25 8.2 Break-even Analysis................................................................................................................26 Table: Break-even Analysis .................................................................................................26 Chart: Break-even Analysis .................................................................................................26 8.3 Projected Profit and Loss .......................................................................................................26 Chart: Gross Margin Monthly ...............................................................................................27 Chart: Gross Margin Yearly..................................................................................................27 Table: Profit and Loss ..........................................................................................................28 Chart: Profit Monthly .............................................................................................................29 Chart: Profit Yearly................................................................................................................30 8.4 Projected Cash Flow...............................................................................................................31 Table: Cash Flow..................................................................................................................31 Chart: Cash ...........................................................................................................................32 8.5 Projected Balance Sheet ........................................................................................................33 Table: Balance Sheet ...........................................................................................................33 8.6 Business Ratios .......................................................................................................................34 Table: Ratios .........................................................................................................................35 8.7 Long-term Plan.........................................................................................................................36 Table: Sales Forecast ...............................................................................................................................1 Table: Personnel ........................................................................................................................................2 Table: General Assumptions ....................................................................................................................4 Table: Profit and Loss ...............................................................................................................................5 Table: Cash Flow .......................................................................................................................................7 Table: Balance Sheet ................................................................................................................................8

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The Fire Fountain Grille 1.0 Executive Summary The following plan is based on years of experience, is highly foc used and promises to follow a path of prosperity for its investors, owners, managers and staff. It is based on conservative sales figures, and ac tual sales may be higher. The projections contained herein are authentic and will be used as the budget for the business. The Fire Fountain Grille® will show a profit immediately, and will increase sales and profits eac h year thereafter. The Fire Fountain Grille is a comfortable, inviting restaurant designed to make our customers feel as if they are enjoying VIP services in a world all to themselves. The dec or and theme is based on an exterior fountain loc ated at the main entrance that has a cascading water fountain c ombined with flame throwing torches. The show kitchen will also feature a custom made "Fire Fountain", a unique show kitchen grill that also has a cascading water fountain combined with flame throwing torches. This spectac ular marvel will be visible from the dining room side, and will be a functioning 48" gas powered steak grill on the kitchen side. The energy and atmosphere of the restaurant is high, and draws some of its power from the dazzling "Fire Fountain". By offering an exciting, tantalizing and rewarding experience for its customers, the Fire Fountain Grille and its service oriented approach will be immediately embrac ed by those that love dining out!

1.1 Objectives 1. 2. 3.

Sales for the first full calendar year will be $2.3 million, with Net Profit/Sales in excess of 19%. A second unit will be opened in the first quarter of year three. A third unit will be opened in the first quarter of year four. Page 1

The Fire Fountain Grille 1.2 Mission ·

· · ·

· · · ·

Fire Fountain Grille is a commercial enterprise, and as such, exists for the purpose of generating sales and profits for its investors, owners, managers and staff. Because Fire Fountain Grille is a service business, it also exists to serve its customers. These two reasons for its existence are inextricable. If one aspec t does not exist, the other will cease to exist. Fire Fountain Grille will offer mouth-watering meals and beverages in a soothing environment. Our staff will be cheerful, courteous, and foc used on pleasing our customers. Our customers will always be treated with importance and warmth. When it comes time for our customers to dec ide where to spend their entertainment dollars, we will strive to bec ome their first destination of choice. Our staff will be offered a workplac e where they can prosper and grow in a dignified, fun and rewarding manner. Our investors will see a lucrative return on their dollars, and will have opportunity for future growth and prosperity with our company. Our vendors will be treated with loyalty, and they will find their future with us to be fruitful. We will be a good neighbor to the businesses in our area, and we will be a contributing and supportive member of our community

1.3 Keys to Success 1. 2.

3. 4.

Our policy of having a manager pass by every table in the dining room every night to greet, visit with, or at least make eye contac t with (with a smile) our customers. Our policy of having a manager visit any and every table that has a question, or if the customer has positive or negative feedback. The manager is required to use every means possible to satisfy our customers. Our commitment to the success and happiness of our staff. Our commitment to providing excellent quality food and beverages at all times.

2.0 Company Summary The Fire Fountain Grille is a steakhouse concept. It offers a comfortable, upsc ale ambience, replete with its signature fountains of flames and water. The menu features original variations of American favorites with a tantalizing array of seasoned steaks, prime rib, roasted caramel chicken, hot gourmet sandwiches and hearty salads. Beverages include an impressive wine list, microbrew beers, and festive coc ktails. Fire Fountain Grille, Unit One, will be loc ated in a newer free standing building. This loc ation is an extremely high visibility spot on one of the most popular commercial corridors in the region. It has excellent parking, excellent ingress and egress from an eight lane thoroughfare.

2.1 Company Ownership Fire Fountain Grille - Unit One LP, is projected as a Limited Partnership, but may switch the Page 2

The Fire Fountain Grille preferred structure to a stoc k "C" Corporation or Limited Liability Corporation "LLC", for purposes of investment structuring (see section 6.1.1 "Investment Summary"). The number of investors could vary, based on various interpretations under SEC "Regulation D". OPERATING PARTNERS 1. 2. 3. 4.

General Managing Partner, with 31% ownership. Vice Managing Partner for Dining Room and Human Resource Operations, with 9% ownership. Vice Managing Partner for Beverage and Entertainment, with 9% ownership. Vice Managing Partner for Kitchen and Catering Operations, with 9% ownership.

INVESTMENT PARTNERS 1. 2. 3.

Limited Partner Group One, with 14% ownership. Limited Partner Group Two, with 14% ownership. Limited Partner Group Three, with 14% ownership.

2.2 Start-up Summary Fire Fountain Grille, Unit One, is a project that will take advantage of a newer, existing structure. Start-up costs will cover a number of details to convert the structure to suit our concept both visually, and functionally. Included in start-up costs are all nec essary expenditures to cover the pre-opening hiring and training of our staff, adding and revising equipment needs, supplying smallwares and servicewares, inventory and other essentials.

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The Fire Fountain Grille Table: Start-up Start-up Requirements Start-up Expenses Legal Stationery, Menus, Brochures Food Inventory Alcohol Inventory Operating Supplies

$5,000 $4,000 $20,000 $8,000 $5,000

Smallwares Uniforms Linen Two Fire Fountains Kitchen Improvements Leasehold Improvements Exterior Improvements Catering Vehicle & Equipment Signage Liquor License Point Of Sale System Computers & Peripherals Office Furnishings Pre-opening Management Labor Pre-opening Labor/Training Pre-opening Advertising & Marketing Permits & Fees Insurance

$22,000 $3,000 $1,500 $30,000 $15,000 $30,000 $10,000 $23,000 $15,000 $4,000 $10,000 $5,000 $1,500 $15,000 $16,000 $8,000 $3,000 $7,500

Rent Research and Development Utility Deposits

$15,000 $5,000 $10,000

Cash Reserve Other Total Start-up Expenses

$25,000 $8,000 $324,500

Start-up Assets Cash Required

$580,500

Start-up Inventory Other Current Assets Long-term Assets Total Assets

$0 $0 $65,000 $645,500

Total Requirements

$970,000

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The Fire Fountain Grille 2.3 Company Locations and Facilities The Fire Fountain Grille is loc ate in a large stand-alone building with plenty of parking next to the Ac res & Ac res Mall, in Electrumburg, a fast growing suburb of Starburstville.

3.0 Products and Services The Fire Fountain Grille is a comfortable, inviting restaurant designed to make our customers feel as if they are enjoying VIP services in a world all to themselves. The dec or and theme is centered around the custom made "Fire Fountain", a unique show kitchen grill that has a cascading water fountain c ombined with flame throwing torches on the dining room side, and is a sizzling 48" gas powered steak grill on the kitchen side. The energy and atmosphere of the restaurant is high, and draws some of its power from the dazzling "Fire Fountain". The real power and energy of the restaurant comes from the attentive and courteous service provided by our floor staff, and the indesc ribably delicious steaks and other entrees caringly prepared by our motivated kitchen team. Each night that we are open, two managers are on duty. One manager carefully orchestrates the proper execution of the kitchen, so that all food comes out prepared perfectly, and on time. The other manager attends to the flow of the dining room, there to fac ilitate outstanding customer service and satisfac tion. Our floor managers are extremely high profile, taking the time to greet every customer at some point in their stay. Our customer service policy is simple: All customers must leave happy about our service and food! We are a dinner-house, but we do offer lunch on Friday, Saturday and Sunday. We have a "late-night seating" 10:00 pm-1:00 am Friday and Saturday. The lights come way down, and customers enjoy light jazz music, and a disc ount on certain food and beverage items. Gift Certificates always available. We have private dining fac ilities for group events, and we offer full catering services for events at any loc ation! We offer "take-out" food for those on the run! Visitors to our website will find upcoming events, specials, and catering and gift certificate information. The restaurant hours are: Monday-Thursday 3:00 pm-10:00 pm; Friday and Saturday 11:00 am-1:00 am; Sunday 11:00 am-9:00 pm.

3.1 Competitive Comparison PF Chang's®, Houston's® and TGI Friday's® are chains that offer fun atmospheres for comparison purposes. Our most competitive edge is our managers, and their ability and willingness to create goodwill among our customers, and to overcome any perceived difficulty, and indeed, turn it around into a positive experience. The Fire Fountain Grille offers steaks and other foods that are prepared with an irresistible combination of flavors and spices. No one else in the industry serves steaks as delicious as ours.

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The Fire Fountain Grille 3.2 Product and Service Description Our menu consists of juicy, thick steaks that are coated with a secret combination of flavorings and zesty spices. These steaks are grilled to perfection. We offer mouth watering prime rib, available "Fire Fountain Style", in four portion sizes. The menu also consists of butter-roasted and seasoned chicken dishes, fresh grilled seafoods, imaginative salads, cold melon chowders, a variety of huge burgers and grilled sandwiches, tender pork chops, soups, appetizers with berry barbec ue sauces, refreshing fountain drinks, and flaming desserts. From the bar patrons can order a wide range of American wines, as well as dozens of beers including the most popular microbrews. The bar also offers festive martinis, margaritas, specialty frozen drinks, and hundreds of coc ktails.

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The Fire Fountain Grille 3.2.1 Menu Fire Fountain Grille Menu We have a "late-night seating" 10:00 pm-1:00 am Friday and Saturday, with a disc ount on food items printed in red... Fire Fountain Specialties...These meals come with your choice of baked tater or sweet tater or red beans n' rice or veggies or fries. Also, you get fresh baked rolls, butter, and a salad! All steaks are seasoned USDA Prime Cuts! You can also order anything on this menu without seasonings! RIBEYE - Perhaps the tastiest of all steaks! Hand cut daily, choose from big (16 ounce) $16.95 or huge (22 ounces) $22.95!! FIRE FOUNTAIN FILET - Tender 9 ounce filet, lightly seasoned and sizzle-grilled $14.95 METROPOLITAN STRIP STEAK - 14 ounce Strip steak, with Bay Shrimp and Citrus-Bearnaise Sauce $17.95

NEW YORK STRIP - Classic Strip Cut, seasoned and grilled $13.95 TOP SIRLOIN - Prime delicate cut, seasoned and grilled to order. America's#1 steak! $11.95 PRIME RIB - Hand carved cuts, slow roasted, and served with au jus and whipped horseradish sauce: 20 ounce - $19.95; 16 ounce - $16.95; 12 ounce - $13.95; 8 ounce - $10.95

Also, try our Fire Fountain Style of Prime Rib! Ask your server!

Seafood... HONEY/CHILI GLAZED SALMON - Fire-Grilled Salmon, brushed with honey-chili glaze and topped with blac k bean salsa $13.95 GRILLED SALMON - With your choice of side dish $12.95

JAMAICAN SNAPPER - Pan c harred, topped with a sweet coc onut-tomato glaze $11.95 ROASTED PRAWNS - 12 Grilled Jumbo Shrimp over rice $13.95 CHICKEN ASTORIA - Breast of chicken, topped with Bay Shrimp and asparagus spears, finished with Citrus-Bearnaise sauce $11.95 FIRE-SMOKE CHICKEN - Robust, entirely dark meat, quarter of a chicken, smoke-roasted,

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The Fire Fountain Grille served with Three Berry Barbec ue Sauce $12.95 CARAMEL FLAMED CHICKEN - Tender Chicken breast, buttered and basted with sweet caramel glaze, then charred over an open flame $10.95

Burgers ‘n such......they come with fries.. THE BACON SPECTACULAR - Broiled 1/3 pound burger with bacon, Cheddar cheese, lettuce, dill pickle and tomato. $5.95 BURGER BURGER - Juicy ½ pounder served on a toasted onion bun with pickle, onion, lettuce and tomato $4.95... add cheese $.50 THE HIGHWAYMAN - Colossal. Char-broiled. One entire pound of juicy ground beef with Canadian bac on, Swiss cheese, lettuce, grilled onions, barbec ue sauce and tomato on a giant bun $7.95 SLOPPY JOE - Sweet ‘n zesty, a mouth-watering favorite! $4.95 SHAVED PRIME RIB SANDWICH - With smoked bac on-horseradish sauce and smothered with melted Monterey Jack cheese $4.95

BARBECUE-BEEF - Huge pile of beef, slathered with barbec ue sauce and melted Cheddar cheeseserved open-fac ed $4.95 CHICKEN RANCH SANDWICH - Golden deep-fried chicken, served on a kaiser roll with Ranch sauce, lettuce and tomato $4.95

Appetizers... GRILLED CHICKEN STRIPS - Served with Three Berry Barbec ue Sauce $4.95 GRILLED STEAK SKEWERS with Ginger Red Sauce $4.95 FIRE STICKS - Fried Pepper-Jack cheese with c ool Ranch Dip $3.95 CHILLED MELON CHOWDER - Bowl $2.95 Cup $1.95 BEER BATTERED SHRIMP with Pineapple Salsa $5.95 CHICKEN STRIPS with Honey-Dijon Sauce $4.95

From The Fountain... Coffee $1.25, Decaf $1.25; Coke, Root Beer, 7-UP, Diet Coke, Iced Tea $1.50; Milk, Large $1.50 Small $1.25; Draft Beers...Pint $2.75, Glass $1.50; Microbrews...Pint $3.00, Glass $1.95

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The Fire Fountain Grille Wines...House Glass $3.95, House Carafe $12.00. Please ask your server for a wine list.

Desserts... Flaming Fruit Kebabs with ice cream $5.95; Cherries Jubilee $5.95; Key Lime Pie $3.95 Milk Shakes $2.95; Banana Split $5.25; Ice Cream Sundae $2.50; Carrot Cake $3.95 Completely Fat-Free Dessert: Chewy Brownies with Frozen Yogurt $2.95

JUST FOR KIDS...Yaaay!! Kids meals come with fries.. Little Burger $3.95; Chicken Toes $3.95; Little Steak $5.95; Cheesaroni $2.95; Corny Dog $3.95; Hot Doggy $3.95...kids soda pop is free!!!

Salads... SMOKED CHICKEN SALAD - with c aramelized Hazel nuts and Ginger-Orange dressing $7.95 Grilled Sirloin Caesar $7.95; Grilled Chicken Caesar $7.95; Grilled Shrimp Caesar $7.95; Traditional Caesar $2.95; Fresh Garden Salad $2.95; - with these dressing choices: Ranch, Bleu Cheese, Catalina, Honey-Mustard, Low-Fat Italian Chilled Melon Chowder - Bowl $2.95, Cup $1.95; Side of Fries $1.95; Sides of Red Beans 'n' Rice or Baked Tater, Sweet Taters, Mashed Taters, or Veggies are $1.95; Grilled Onions $1.95; Daily Soup -Bowl $2.95, Cup $1.95 Remember! We offer "to-go" food for those on the run!

Please visit our Website!

4.0 Market Analysis Summary Electrumburg is a dynamic city loc ated in the rapidly growing Southeast part of the Starburstville metropolitan area. The city is known for its excellent medical and educational institutions, beautiful neighborhoods, easy ac cess to freeways and a diversified economic base. From a residential perspective, Electrumburg features master-planned communities, luxury executive homes, older residences in tree-lined neighborhoods and affordable starter housing. A robust economy, attrac tive residential developments, exciting commercial and business growth, dynamic neighborhoods and abundant civic pride combined with outstanding city services - Electrumburg has all of the amenities nec essary for ensuring a quality lifestyle. Electrumburg has been one of the fastest-growing cities in one of the fastest-growing metropolitan areas in the United States over the past three dec ades. The city's population grew 48 percent during the 1990s. Today, Electrumburg has a population of more than 225,000. Electrumburg is adjac ent to Starburstville (pop. 500,000), within the Valley with 1.6 million residents.

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The Fire Fountain Grille The median age of "Electrumburgians" is 39 years, and more than 59 percent of its residents are college- educated. Of the five largest cities in the Valley, Electrumburg has the most homes with married couples (53 percent) and the largest percentage of households with children under 18 years old living at home (32 percent). The demographics of Electrumburg's workforce are almost identical to that of the region, providing an excellent labor pool for businesses of all sizes. The fac t that Electrumburg is part of a vibrant metropolitan area makes it a very attrac tive plac e to live and establish a business.

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The Fire Fountain Grille 4.1 Market Segmentation Fire Fountain Grille, Unit One, is loc ated in Electrumburg. Ac cording to the Electrumburg Chamber of Commerce and the US Census Bureau, the population within a five mile radius of this address is nearly 125,000, with over 59,000 households, and over 400 businesses. Income within one mile is over $81,000, $72,000 within three miles and $60,000 within five miles. Per capita retail spending in this area exceeds $13,000, with total retail spending exceeding $2.8 billion! The first tier target segment for Fire Fountain Grille concentrates on the 30-44 year old age range, with income in the $40,000 - $80,000 range, loc ated within a five mile radius. Second tier is the 45-59 year old range, with income in the $55,000 - $90,000 range, loc ated within a five mile radius. Third tier is the 21-29 group, with income at $36,000 - $60,000, loc ated within a five mile radius. Fourth tier is a combination of the age and income ranges mentioned in tiers 1-3, but extends the geographic radius to seven miles. Fifth tier is age ranges 60+, within five miles, and income of $65,000+. Sixth, and final tier is a composite of age ranges 60+, 10-20, and under 10, with a radius of five - seven miles, and a mixture of incomes.

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The Fire Fountain Grille Table: Market Analysis Market Analysis Year 1

Year 2

Year 3

Year 4

Year 5

Potential Customers Ages 30-44 (within 5 mile radius)

Growth 10%

48,000

52,800

58,080

63,888

70,277

CAGR 10.00%

Ages 45-59 (within 5 mile radius) Ages 21-29 (within 5 mile radius) Ages 60 + (within 5 mile radius) Ages 10-20 (within 5 mile radius) Ages 2-10 (within 5 mile radius) Total

9%

30,000

32,700

35,643

38,851

42,348

9.00%

9%

24,000

26,160

28,514

31,080

33,877

9.00%

7%

42,000

44,940

48,086

51,452

55,054

7.00%

5%

30,000

31,500

33,075

34,729

36,465

5.00%

2%

26,000

26,520

27,050

27,591

28,143

2.00%

7.41%

200,000

214,620

230,448

247,591

266,164

7.41%

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The Fire Fountain Grille 4.2 Target Market Segment Strategy Strategically, targeting the 30-44 year old age range in upper middle class areas close to our restaurant helps serve the needs and requirements of our customers, and ties in logically with our marketing plan (see Marketing Plan) and style of restaurant. Typically, the upper middle class in the 30-44 range are raising families whose children range from toddlers to teens, yet tend to continue to have "disposable" dollars available for a quality diversion (such as Fire Fountain Grille) to get them away from home and work. These customers have regimented sc hedules in their lives, and find value in exceptional service, timely service, and mouth watering, delightful food. If a couple chooses to leave the kids home, they'll find value in the form of satisfac tion and fun together, in their diversionary time. If they bring the kids, they will appreciate a value based kids menu. This first tier of our market segment, is also the primary foc us of our marketing plan (see Marketing Plan), which has a deep commitment to foc using on kids, at their sc hools and in their community. These kids are primarily the children of our 30-44 tier-one group. Industry research (Nation's Restaurant News®) has shown that the 30-44 age group appreciates steaks, chops, chicken and seafood dishes prepared with lightly seasoned recipes, which is a perfect fit for Fire Fountain Grille. Our SECOND-TIER market group (45-59 / $55,000 - $ 80,000), will also find value in great service, and delicious food, and will appreciate a restaurant with a much better wine list than what is normally available in the upsc ale casual dining niche. Fire Fountain Grille will also be considered a refreshing escape from restaurants that sing and clap for birthdays. Our THIRD-TIER group, the 21-29 year olds will find that the menu contains many favorites available to them that are considered essential: tantalizing appetizers, spicy steaks, and hundreds of coc ktails and specialty beers. The Fire Fountain turns down the lights for late hour business on the weekends, and offers jazz and food and beverage specials, offering our customers a chance for some soc ializing and conversation. FOURTH-TIER simply extends the market radius out to a five mile area, with the same demographics included in tiers 1-3. FIFTH-TIER (60+ / $65,000+), represents a market that has abundant disposable income, and truly reveres attentive, efficient service. Fire Fountain Grille serves all of its meals with the option of cooking with little or no spices. This customization is much more appreciated by this group, who often prefer meals prepared to their own spec ifications. Because Fire Fountain Grille has only one purpose in mind when it comes to our customers – All Customers Must Leave Happy, customizing a meal to our treasured customers will always be a pleasure! The SIXTH-TIER group will benefit from all of the quality approaches that are marketed to the previous five tiers, and will gain exposure to us primarily through our community involvement and word-of-mouth.

4.2.1 Market Trends The trends in the Starburstville Metro market rely heavily on visual appeal, and loc ations. Most restaurants overlook targeting kids as a way to market to the parents. The Fire Fountain Grille does not seek to market to kids to get them to eat at our restaurant, but rather as a way to get their parents to eat there.

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The Fire Fountain Grille 4.2.2 Market Growth Steak restaurants comprise less than 5% of the total restaurant market. Service oriented steak houses have room to grow. Meat and potatoes is still what Americans want, and they want it with good service.

4.2.3 Market Needs The market suffers from a lac k of service oriented restaurants. The market needs a restaurant that values the customer as its number one priority.

4.3 Service Business Analysis All restaurants combined, from fast food to fine dining, show an average bottom line profit of 310%. Margins are much better in full service restaurants with good management, good staff, good concepts, good menus and wine lists, good loc ation and good financial controls. A full service steakhouse with all of these fac tors should show a bottom line profit of 13% - 25%.

4.3.1 Competition and Buying Patterns The general nature of competition in this business, and how the customers seem to choose one provider over another can be measured by customer loyalty and positive word of mouth. Customer loyalty and brand preference come from developing a trust between the customer and the business. To be successful in the hospitality business, one must truly believe in, and always apply, the fundamental meaning of hospitality, which simply stated is, one must always be hospitable, and the customer must truly be made to feel welcome and cared for. The trust that a customer feels, is based upon the business' ability to recognize what it takes to please a customer, and then is built upon by continuously delivering to that customer at, or above, the level of expec tation that the customer expec ts. Fire Fountain Grille has carefully selected a management team that has been spec ially trained in the high art of exceptional customer service. The sc reening, hiring and training standards for front-of-the house staff are the highest in the industry. The level of attention and care that our staff bestows upon our customers sets us far above our competition. Fire Fountain Grille also has extremely high standards for professionalism in the kitchen. Cleanliness, freshness of ingredients, adherence to recipe and cooking standards, and efficiency are constantly applied. Prices are reasonable, and are perceived as being an exceptional value. Fire Fountain Grille offers extremely delicious steaks, tantalizing chicken dishes, savory grilled seafoods, tender prime rib, fresh salads, sensational appetizers, tempting desserts and refreshing beverages. All of this can be found in an environment with an ambience that is unusual, and very comfortable. Our signature "Fire Fountain" fills the restaurant with an exciting glow, and the soothing sounds of falling water. The seating is almost all private booths, creating an atmosphere of relaxation and comfort. The Fire Fountain Grille is conveniently loc ated on a highly visible ingress near a successful mall. The restaurant has a huge, secure parking lot, excellent ingress and egress, and a beautiful and highly noticeable exterior. This area has other restaurants, which is a definite plus for us. This allows us to capitalize on a positive "clustering" effect, and works well with our marketing Page 14

The Fire Fountain Grille strategy.

4.3.2 Main Competitors Competition comes from major chains and from various independents.

4.3.3 Business Participants The general category is eating and drinking plac es. Typically, this can be broken down as follows: 1. 2. 3. 4. 5. 6. 7. 8.

Fine dining (white tablecloths, expensive wines). Private Clubs and Country Clubs Upsc ale Upsc ale casual (good prices, fun) Boiler plate casual Neighborhood plac es Breakfast/lunch/dinner chains Fast Food

The Fire Fountain Grille will participate in the upsc ale casual category.

5.0 Strategy and Implementation Summary Emphasize service We will differentiate ourselves with SERVICE! We will establish our business offering as a clear and viable alternative for our target market, from the sc ores of "rubber chicken", frozen food, and "Happy Birthday singing" restaurant chains. Build a relationship-oriented business Build long-term relationships with c ustomers, not single-visit deals. Become their restaurant and destination of choice. Make them understand the value of the relationship. Focus on target markets We need to foc us our offerings on specific population groups as the key market segment we should own. We do not want to compete for the buyers who go to fast food or "microwave frozen foods" types of "restaurants. We definitely want to be able to sell to smart, quality consc ious customers.

5.1 Competitive Edge Clearly, our competitive edge is the customer service experience and approach that our management team will bring to the table. Our smiling, unassuming and good natured approach to all of our customers is evident, and highly appreciated. Our recipes are delicious, and the portions are large. The foods are fresh and satisfying, and the drinks are fulfilling and refreshing. Page 15

The Fire Fountain Grille 5.2 Marketing Strategy An overview of the marketing plan includes: • Kids Tours • Gift Certificate Program • In-store comp cards • Direct mail • Free surprise dinners for radio station DJ's. • Charity events for senior citizens, high sc hools, grade schools, churches and community centers. • Trade shows • Vintner and Chef Dinners • Eye-catching exterior and interior neons, fountains and torches. • High profile interac tion between our managers, and the customers. • Excellent service and high food quality every single day in the restaurant.

5.2.1 Positioning Statement The Fire Fountain Grille. Sizzling, Refreshing, Exciting! For A Dinner To Remember...

5.2.2 Pricing Strategy Prices are fit to attrac t the consumer who prefers a quality steak for a reasonable price. The prices are above those of operators such as Sizzler®, El Paso BBQ® and Blac k Angus®, are below Ruth's Chris® and Morton's®.

5.2.3 Promotion Strategy The Fire Fountain Grille uses a mix of various promotions and media to spread news about ourselves. This includes: 1.

2. 3. 4. 5. 6. 7. 8.

Direct mail, generated from in-store "Event Cards" and customer's business cards. Event cards are forms that the customers fill out so as to receive notices of our upcoming events. Young people's tours, to generate enthusiasm among the kids in our area, who in turn spread it to their folks. Eye-catching exterior neons and torches. In-store comp cards for appetizers and desserts. Free surprise dinners for radio station DJ's. Charity events for senior citizens, high schools, grade sc hools, churches and community centers. Trade shows, to promote private dining, banquets and catering. "Vintner and Chef Dinners" bringing together the wine making and culinary fields at Page 16

The Fire Fountain Grille 9. 10.

showcase events, to be held at the Fire Fountain Grille. High profile interac tion between our managers, and the customers. Excellent service and high food quality every single day in the restaurant.

5.2.4 Marketing Programs Children's tours will be an ongoing program that has proven to work over and over again. The kids are brought to the restaurant by teac hers or parents, in groups of no more than 25, and are greeted at the door by our manager. They all go inside and are seated near the Fire Fountain where they are told a cool short story. They then are taken on a tour of the store and kitchen and get to go inside of a giant refrigerator, and see some cool cooks doing their thing. Then everyone is seated for a free lunch of "Chicken Toes" or "Hot Doggies" and soda pop. Everybody talks a little about restaurants and other neat stuff. When its time to say goodbye, we take pictures and everybody gets an appetizer or dessert card, and some promotional menus. When the kids come bac k with their parents, we address the kids by their first names and treat them special.

5.3 Sales Strategy We require our servers to have a thorough and comprehensive understanding of the menus, ingredients and methods of preparation of all of our foods and beverages. We train our staff to always describe and recommend items, even to regular customers, and to always upsell. The key to a server's success in upselling is the realization that it almost always brings in better tips bec ause the chec ks are higher. GIFT CERTIFICATES The Fire Fountain Grille will aggressively sell gift certificates. The strategy behind gift certificate sales is simple and proven. Most GC sales oc cur during the holidays. Most GC's are then redeemed in the post holiday months of January and February, helping drive sales in those traditionally slower months.

5.3.1 Sales Forecast The first month sales will open strongly, bec ause of the advance buzz created by our preopening marketing, and our Grand Opening Festivities. Sales will drop off slightly as we begin to sort out our operational patterns. September is a slower month for restaurants. October and November see sales begin to build as we continue with our marketing, and relentless quality. December sees a sharp spike upward as the Holidays are in full swing. A typical week for the first six months will look like this (conservative estimate): Sun.

Mon.

Tues.

Wed.

Thurs.

Fri.

Sat.

Total Sales

$8,500

$4,000

$4,000

$5,500

$7,000

$9,500

$11,500

$50,000

Years 2005 - 2008 will see an 8% annual increase. Costs will be higher during the startup months. Page 17

The Fire Fountain Grille Table: Sales Forecast Sales Forecast Sales Food Beverage Liquor Beer Wine Total Sales Direct Cost of Sales Food Beverage Liquor Beer Wine Subtotal Direct Cost of Sales

Year 1

Year 2

Year 3

Year 4

Year 5

$1,058,353 $43,588 $59,890 $83,801 $52,325 $1,297,957

$1,935,200 $70,800 $106,200 $153,400 $94,400 $2,360,000

$2,090,016 $76,464 $114,696 $165,672 $101,952 $2,548,800

$2,257,217 $82,581 $123,871 $178,925 $110,108 $2,752,702

$2,437,794 $89,187 $133,781 $193,239 $118,916 $2,972,917

Year 1 $359,706 $2,955 $7,949 $15,716 $10,795 $397,121

Year 2 $657,968 $5,664 $16,057 $32,214 $20,768 $732,671

Year 3 $710,605 $6,117 $16,048 $34,791 $22,429 $789,990

Year 4 $767,453 $6,606 $17,342 $37,574 $24,223 $853,198

Year 5 $828,850 $7,135 $18,729 $40,580 $26,161 $921,455

Page 18

The Fire Fountain Grille

5.4 Strategic Alliances The Fire Fountain Grille will align with hotels, movie theatres, live theatres, cab companies, banks and retail stores in an informational broc hure exchange. Each business will have a chance to promote the other businesses at their plac e of business. Additionally, our respec tive businesses will barter with eac h other, using gift certificates and comps.

5.5 Milestones The milestone table is set up as a flow-chart. We opted to exclude budgeted dollars in the milestone category bec ause we detailed these dollars in the start-up table. The milestone table is spec ific in detail, allowing for the smooth flow of functions that are nec essary to set up the restaurant on sc hedule for the Grand Opening. Each function is timed to coincide with the proper execution and time needed to complete eac h task. Each Managing Partner has specific duties assigned spec ifically to his area of expertise. The end of the milestone table also shows the beginning of the 2004 marketing plan.

Page 19

The Fire Fountain Grille Table: Milestones Milestones Milestone Office/Computer Supplies Install Accounting Programs Set Up Utility Accounts Finan./Legal/Ins. Accounts Expedite Liquor License Order POS System Begin Screening/Hiring Order Kitchen Equipment Order Dining Room Equip Order Fountain & Decos Computerize Food Accts. All Other Vendor Accounts Produce Brochures Brochures To Printers Order Smallwares Invites To Opening Events

Start Date 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/1/2004 4/2/2004 4/2/2004

End Date 4/5/2004 4/5/2004 4/5/2004 4/5/2004 4/5/2004 4/5/2004 4/5/2004 4/5/2004 4/5/2004 4/7/2004 4/7/2004 4/7/2004 4/7/2004 4/7/2004 4/7/2004 4/7/2004

Budget $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0

4/2/2004 4/2/2004 4/2/2004 4/2/2004 4/8/2004 4/8/2004

4/10/2004 4/10/2004 4/10/2004 4/10/2004 4/10/2004 4/10/2004

$0 $0 $0 $0 $0 $0

MP MP MP MP MP MP

1 4 1 2 2 2

Finance/Ops. Personnel Finance/Ops. Start-up Start-up Beverages

Rec/Install Kitch Equipment Install Dining Furn Install Fountain/Decos Install Signs & Neons Train POS System Final Test Of All Equipment

4/8/2004 4/8/2004 4/8/2004 4/8/2004 4/8/2004 4/15/2004

4/16/2004 4/16/2004 4/16/2004 4/16/2004 4/16/2004 4/16/2004

$0 $0 $0 $0 $0 $0

MP MP MP MP MP MP

3 2 4 2 1 1

Kitchen Start-up Start-up Start-up Finance/Ops. Finance/Ops.

Order Dry Goods Building & Fire Inspect Receive Smallwares

4/15/2004 4/15/2004 4/15/2004

4/18/2004 4/18/2004 4/18/2004

$0 $0 $0

MP 3 MP 2 MP 3

Kitchen Start-up Kitchen

Health Dept. Inspection Receive Dry Goods 2nd Hiring Goals Place 1st PFG (food) Order Place 1st Alcohol Orders Begin Training FOH Staff

4/15/2004 4/15/2004 4/15/2004 4/21/2004 4/21/2004 5/1/2004

4/15/2004 4/15/2004 4/15/2004 4/21/2004 4/21/2004 5/15/2004

$0 $0 $0 $0 $0 $0

MP MP MP MP MP MP

3 3 4 3 2 4

Kitchen Kitchen Personnel Kitchen Beverages Personnel

5/1/2004 5/1/2004 5/1/2004

5/15/2004 5/15/2004 5/1/2004

$0 $0 $0

MP 2 MP 3 MP 3

Beverages Kitchen Kitchen

Receive 1st PFG Shipment Produce/Dairy/Bread Delivery Achieve Final Hiring Goals Test Night For Staff Associates Night Fundraiser For Senior Center

5/15/2004 5/15/2004 5/15/2004 5/29/2004 5/30/2004 5/31/2004

5/15/2004 5/15/2004 5/15/2004 5/29/2004 5/30/2004 5/31/2004

$0 $0 $0 $0 $0 $0

MP MP MP MP MP MP

3 3 4 2 4 1

Kitchen Kitchen Personnel Beverages Marketing Finance/Ops.

Grand Opening Staff Party Kids Tour

6/1/2004 6/10/2004 6/11/2004

6/1/2004 6/10/2004 6/11/2004

$0 $0 $0

MP 4 MP 2 MP 4

Sales Marketing Marketing

Kids Tour Free Lunch Chamb Comm Kids Tour 1st Rotary Lunch

6/25/2004 7/1/2004 7/16/2004 7/26/2004

6/25/2004 7/1/2004 7/16/2004 7/26/2004

$0 $0 $0 $0

MP MP MP MP

Dates Final Inspections First Hiring Goals Attained Signs/Exterior Neons Hire Tradesmen Purchase Catering Vehicle Alcohol Accounts

Begin Training Bar Staff Begin Training Kitchen Staff 1st Produ/Dairy/Bread

Manager MP 1 MP 1 MP 1 MP 1 MP 1 MP 1 MP 4 MP 1 MP 1 MP 1 MP 3 MP 3 MP 4 MP 4 MP 3 MP 4

4 1 4 1

Department Finance/Ops. Finance/Ops. Finance/Ops. Finance/Ops. Finance/Ops. Finance/Ops. Personnel Kitchen Finance/Ops. Finance/Ops. Kitchen Kitchen Marketing Marketing Kithcne Marketing

Marketing Finance/Ops. Marketing Finance/Ops.

Page 20

The Fire Fountain Grille Kids Tour Totals

7/29/2004

7/29/2004

$0

MP 4

Marketing

$0

6.0 Web Plan Summary Our website, is an opportunity to offer current information on spec ial events, menu offerings, public service announcements and comp specials.

6.1 Website Marketing Strategy Our website will be promoted on all of our menus, and promo pieces. We will link to CitySearch. com® and many other hospitality oriented websites and portals.

6.2 Development Requirements The Fire Fountain Grille website will be initially developed with few technical resources. VeriSign® will host the site and provide the technical bac k end. We will maintain a simple, classy, yet Internet foc used site. The website logos, and graphics will be the same artwork found on our hard-copy menus, and in various spots in the business plan. Our managers will maintain the website. As the website rolls out future development such as restaurant delivery options, newsletters and downloadable market research reports, a technical resource may need to be contrac ted to build the trac kable download and the newsletter capabilities. We will also look into pre-pac kaged solutions through VeriSign® and other Web hosting resources.

7.0 Management Summary We will open with a team of four manager/owners, one bookkeeper, and fifty-three staff members. Each member of the management team has specific industry experience that will apply to their assignment. Each Vice Managing Partner will also cross train for one year in preparation for their promotions to their own Fire Fountain Grille units. This is an extremely experienced and well balanced team. There are no gaps in its structure.

Page 21

The Fire Fountain Grille 7.1 Personnel Plan The personnel table (labor pro-forma) shows the number, and structure of the "bac k-of-thehouse" (BOH), "front-of-the-house" (FOH), and management staffs. June 2004 has a higher labor cost, as is usual in a restaurant start-up. Labor costs come down as the operation begins to flow more smoothly. The service staff is large, and is nec essary to provide the level of service that the Fire Fountain Grille needs to set it apart from the competition.

Page 22

The Fire Fountain Grille Table: Personnel Personnel Plan Year 1 Production Personnel Assistant Chef

Year 2

Year 3

Year 4

Year 5

$1,750

$3,000

$3,036

$3,121

$3,184

Lead Cook/Grill Grill Two Broiler Cook One Broiler Cook Two Fry Cook One Fry Cook Two

$10,340 $4,180 $10,240 $4,180 $8,600 $4,300

$17,725 $7,165 $17,554 $7,165 $14,742 $7,371

$18,079 $7,308 $17,905 $7,308 $15,037 $7,518

$18,441 $7,454 $18,263 $7,454 $15,338 $7,668

$18,809 $7,603 $18,628 $8,050 $15,644 $7,822

Wheel Man One Wheel Man Two Salad Cook One Salad Cook Two Prep Cook One Prep Cook Two Prep Cook Three Dish One Dish Two Subtotal

$4,300 $2,780 $8,600 $4,300 $8,260 $8,260 $8,260 $7,440 $4,350 $100,140

$7,371 $4,765 $14,742 $7,371 $14,160 $14,160 $14,160 $12,754 $7,371 $171,576

$7,518 $4,860 $15,037 $7,518 $14,443 $14,443 $14,443 $13,009 $7,518 $174,980

$7,668 $4,957 $15,338 $7,668 $14,732 $14,732 $14,732 $13,269 $7,668 $178,503

$7,822 $5,056 $15,644 $7,822 $15,026 $15,026 $15,026 $13,534 $7,882 $182,578

$1,980 $3,380 $27,264 $13,632 $15,940 $5,120

$3,360 $5,760 $46,000 $23,004 $26,880 $8,640

$3,427 $5,875 $46,000 $23,004 $26,880 $8,640

$3,495 $5,992 $46,000 $23,004 $26,880 $8,640

$3,564 $6,111 $46,000 $23,004 $26,880 $8,640

$2,560 $2,500 $3,500

$4,320 $4,200 $6,000

$4,320 $4,200 $6,000

$4,320 $4,200 $6,000

$4,320 $4,200 $0

Subtotal

$75,876

$128,164

$128,346

$128,531

$122,719

General and Administrative Personnel Managing Partner 1 Managing Partner 2 Managing Partner 3

$17,500 $17,500 $17,500

$30,000 $30,000 $30,000

$30,000 $30,000 $30,000

$30,000 $30,000 $30,000

$30,000 $30,000 $30,000

Managing Partner 4 Bookkeeper Subtotal

$17,500 $11,200 $81,200

$30,000 $19,200 $139,200

$30,000 $20,160 $140,160

$30,000 $21,168 $141,168

$30,000 $22,226 $142,226

Other Personnel Event by Event Basis TBD

$0

$0

$0

$0

$0

Event by Event Basis TBD Subtotal

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

Total People

0

0

0

0

0

Total Payroll

$257,216

$438,940

$443,486

$448,202

$447,523

Sales and Marketing Personnel One (1) Floor Supervisor One (1) Window Expediter Ten (10) Full-time Servers Ten (10) Part-time Servers Four (4) Full-time Bartenders Two (2) Full-time Hostesses Three (3) Part-time Hostesses Four (4) Bussers Food Runner

Page 23

The Fire Fountain Grille 8.0 Financial Plan Our main c oncerns will be aggressive time management, so that our labor costs stay under control, and proper purchasing, prep and food handling to keep food costs down, as well as managing the higher costs of meats and seafoods. Secondarily, hiring the best grill and broiler cooks, training them properly and retaining them will be a critical component to good meat and seafood costs. A good grill cook does not waste steaks by burning them, nor does he anger customers by undercooking them. He must also be ac curate time after time in how he carves his prime rib. Growth will be sustained through a contribution to an expansion fund, and potential investment from current investors in a "roll-over" plan, and from potential future investors or bank capital.

8.1 Start-up Funding We are seeking $900,000 (see section 2.2 "Start-up Summary"), and will seek it from one, two, or three investment groups, or under an SEC "Regulation D" equity offering (where the company sells partial ownership in the company - via the sale of stoc k or a membership unit, to raise capital). We prefer this approach as an early stage company bec ause there is no set repayment schedule or debt service payments - the investors profit when the company profits. Initially, the company is projected as a Limited Partnership, but may switch the preferred structure to a stoc k "C" Corporation or Limited Liability Corporation "LLC". The preparation of the investment documents will be handled in a cooperative effort by the legal firms representing eac h party individually. These documents will include, but are not limited to: Private Placement Memorandum The Private Plac ement Memorandum, or "PPM", is the doc ument that disc loses all pertinent information to the investors about the company, proposed company operations, the transaction structure (whether we are selling equity ownership or raising debt financing from the investors), the terms of the investment (share price, note amounts, maturity dates, etc.), risks the investors may fac e, etc. Form D SEC Filing It notifies the SEC that we are using the Regulation D program and provides them basic information on the company and the offering. It is not an approval document or registration - it is merely a filing that notifies the SEC that we have a Regulation D Offering in plac e. Raising capital from investors without filing this document with the Federal government could plac e a company in violation of securities laws. Subscription Agreement The Subsc ription Agreement sets forth the terms and conditions of the investment. It is the "sales contrac t" for purchasing the securities. Promissory Note For a debt offering (if nec essary), outlining the terms of any loan arrangement with the

Page 24

The Fire Fountain Grille investors. The note is the ac tual "loan document" between the company and the investor.

Table: Start-up Funding Start-up Funding Start-up Expenses to Fund Start-up Assets to Fund Total Funding Required

$324,500 $645,500 $970,000

Assets Non-cash Assets from Start-up Cash Requirements from Start-up Additional Cash Raised Cash Balance on Starting Date Total Assets

$65,000 $580,500 $0 $580,500 $645,500

Liabilities and Capital Liabilities Current Borrowing Long-term Liabilities Accounts Payable (Outstanding Bills) Other Current Liabilities (interest-free) Total Liabilities

$0 $50,000 $10,000 $10,000 $70,000

Capital Planned Investment Investor Group One Investor Group Two Investor Group Three

$300,000 $300,000 $300,000

Investor Contingency Additional Investment Requirement Total Planned Investment

$0 $0 $900,000

Loss at Start-up (Start-up Expenses) Total Capital

($324,500) $575,500

Total Capital and Liabilities

$645,500

Total Funding

$970,000

Page 25

The Fire Fountain Grille 8.2 Break-even Analysis Break-even based on fixed costs including rent, insurance, maintenance, investor note, and pre-opening amortization. Additionally, controllables such as service labor, kitchen labor, management labor, payroll taxes, property taxes, excess rent, advertising and legal/ professional fees are included.

Table: Break-even Analysis Break-even Analysis Monthly Revenue Break-even

$64,679

Assumptions: Average Percent Variable Cost Estimated Monthly Fixed Cost

31% $44,890

8.3 Projected Profit and Loss 2004 is not a full year on the yearly P&L. Highlights include a bottom line of better than 18% for every year. The numbers reflect realism in the start up and continuing operations of the restaurant. We begin c ontributing aggressively to an expansion fund in 2005. We begin ac cruing for vac ations immediately, and we are budgeting money from the insurance line for health benefits, all as an early commitment to the future prosperity of our staff. These numbers are an excellent indication that our investors, owners, partners and staff will all Page 26

The Fire Fountain Grille prosper and grow with the Fire Fountain Grille!

Page 27

The Fire Fountain Grille Table: Profit and Loss Pro Forma Profit and Loss Year 1 $1,297,957 $397,121 $100,140 $0 $497,261

Year 2 $2,360,000 $732,671 $171,576 $0 $904,247

Year 3 $2,548,800 $789,990 $174,980 $0 $964,970

Year 4 $2,752,702 $853,198 $178,503 $0 $1,031,701

Year 5 $2,972,917 $921,455 $182,578 $0 $1,104,033

$800,696 61.69%

$1,455,753 61.68%

$1,583,830 62.14%

$1,721,001 62.52%

$1,868,884 62.86%

Sales and Marketing Expenses Sales and Marketing Payroll Operating Supplies Janitorial Repairs Aprons, Towels & Napkins

$75,876 $12,940 $10,500 $1,750 $7,000

$128,164 $23,600 $18,000 $3,000 $12,000

$128,346 $27,840 $18,000 $6,000 $12,000

$128,531 $32,860 $18,000 $6,000 $12,000

$122,719 $38,770 $18,000 $9,000 $12,000

Menus Miscellaneous Supplies Miscellaneous Purchases Complimentary Meals or Drinks For PR Advertising/Promotion Credit Card Charges

$1,050 $1,750 $51,500 $5,250 $3,000 $10,760

$1,800 $3,000 $3,000 $9,000 $6,000 $23,600

$1,800 $3,000 $3,000 $9,000 $6,000 $27,840

$1,800 $3,000 $3,000 $9,000 $6,000 $32,680

$1,800 $3,000 $3,000 $9,000 $6,000 $38,775

$1,050 $1,000 $525 $600 $0 $3,500

$1,800 $3,000 $900 $1,800 $3,000 $6,000

$1,800 $3,000 $900 $1,800 $3,000 $6,000

$1,800 $3,000 $900 $1,800 $6,000 $6,000

$1,800 $3,000 $900 $1,800 $6,000 $6,000

$188,051 14.49%

$247,664 10.49%

$259,326 10.17%

$272,371 9.89%

$281,564 9.47%

General and Administrative Expenses General and Administrative Payroll Sales and Marketing and Other Expenses Depreciation Leased Equipment Utilities

$81,200 $0 $13,500 $1,050 $58,000

$139,200 $0 $24,000 $1,800 $99,000

$140,160 $0 $24,000 $1,800 $105,000

$141,168 $0 $24,000 $1,800 $108,000

$142,226 $0 $24,000 $1,800 $111,000

Amortization Debt Service Insurance

$35,000 $25,000 $21,000

$60,000 $75,000 $36,000

$60,000 $150,000 $38,000

$60,000 $175,000 $40,000

$60,000 $175,000 $42,000

Excess Insurance Property Taxes Excess Taxes Vacation Accrual Base Rent Percentage Rent

$3,500 $10,500 $3,500 $2,450 $42,000 $12,958

$6,000 $18,000 $6,000 $4,200 $72,000 $23,600

$6,500 $19,000 $6,200 $4,300 $72,000 $27,848

$7,000 $20,000 $6,300 $4,500 $72,000 $32,860

$7,500 $21,000 $6,400 $4,700 $72,000 $38,775

CAM Rent Payroll Taxes Other General and Administrative Expenses Total General and Administrative Expenses General and Administrative %

$5,250 $25,722 $0

$9,000 $43,894 $0

$9,500 $44,349 $0

$10,000 $44,820 $0

$10,500 $44,752 $0

$340,630

$617,694

$708,657

$747,448

$761,653

26.24%

26.17%

27.80%

27.15%

25.62%

Sales Direct Cost of Sales Production Payroll Other Costs of Goods Total Cost of Sales Gross Margin Gross Margin % Operating Expenses

Fraud Credit Cards/Checks Professional Fees Membership Fees Uniforms Travel Employee Discounts Total Sales and Marketing Expenses Sales and Marketing %

Page 28

The Fire Fountain Grille Other Expenses: Other Payroll Consultants

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$10,000 $10,000 0.77%

$50,000 $50,000 2.12%

$40,000 $40,000 1.57%

$75,000 $75,000 2.72%

$125,000 $125,000 4.20%

Total Operating Expenses

$538,681

$915,358

$1,007,983

$1,094,819

$1,168,217

Profit Before Interest and Taxes EBITDA Interest Expense Taxes Incurred

$262,015 $275,515 $4,928 $38,510

$540,395 $564,395 $3,916 $80,472

$575,847 $599,847 $2,860 $93,110

$626,182 $650,182 $1,804 $93,657

$700,667 $724,667 $748 $113,737

Net Profit Net Profit/Sales

$218,577 16.84%

$456,007 19.32%

$479,877 18.83%

$530,721 19.28%

$586,182 19.72%

Expansion Fund Total Other Expenses Other %

Page 29

The Fire Fountain Grille

Page 30

The Fire Fountain Grille 8.4 Projected Cash Flow The cash flow depends on assumptions for good daily operational management, good traffic counts in the restaurant, inventory turnover, payment days, and ac counts receivable management. We will need no new financing until we open our second unit. Initial projections are a sales-to-investment ratio in excess of 2-to-1, return on investment in excess of 30 percent and return on equity of 20 percent-plus.

Table: Cash Flow Pro Forma Cash Flow Year 1

Year 2

Year 3

Year 4

Year 5

$1,297,957 $1,297,957

$2,360,000 $2,360,000

$2,548,800 $2,548,800

$2,752,702 $2,752,702

$2,972,917 $2,972,917

$0 $0 $0 $0

$0 $0 $0 $0

$0 $0 $0 $0

$0 $0 $0 $0

$0 $0 $0 $0

$0 $0 $0 $1,297,957

$0 $0 $0 $2,360,000

$0 $0 $0 $2,548,800

$0 $0 $0 $2,752,702

$0 $0 $0 $2,972,917

Year 1

Year 2

Year 3

Year 4

Year 5

$257,216 $738,769 $995,985

$438,940 $1,521,269 $1,960,209

$443,486 $1,551,338 $1,994,824

$448,202 $1,739,681 $2,187,883

$447,523 $1,908,341 $2,355,864

Additional Cash Spent Sales Tax, VAT, HST/GST Paid Out Principal Repayment of Current Borrowing

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

Other Liabilities Principal Repayment Long-term Liabilities Principal Repayment Purchase Other Current Assets Purchase Long-term Assets Dividends Subtotal Cash Spent

$0 $9,600 $0 $0 $0 $1,005,585

$0 $9,600 $0 $0 $0 $1,969,809

$0 $9,600 $0 $0 $0 $2,004,424

$0 $9,600 $0 $0 $0 $2,197,483

$0 $9,600 $0 $0 $0 $2,365,464

$292,372 $872,872

$390,191 $1,263,063

$544,376 $1,807,438

$555,219 $2,362,657

$607,453 $2,970,110

Cash Received Cash from Operations Cash Sales Subtotal Cash from Operations Additional Cash Received Sales Tax, VAT, HST/GST Received New Current Borrowing New Other Liabilities (interest-free) New Long-term Liabilities Sales of Other Current Assets Sales of Long-term Assets New Investment Received Subtotal Cash Received Expenditures Expenditures from Operations Cash Spending Bill Payments Subtotal Spent on Operations

Net Cash Flow Cash Balance

Page 31

The Fire Fountain Grille

Page 32

The Fire Fountain Grille 8.5 Projected Balance Sheet The balance sheet is quite solid. We do not project any real trouble meeting our debt obligations--as long as we can ac hieve our specific objectives.

Table: Balance Sheet Pro Forma Balance Sheet Year 1

Year 2

Year 3

Year 4

Year 5

Current Assets Cash Inventory Other Current Assets Total Current Assets

$872,872 $61,302 $0 $934,174

$1,263,063 $123,910 $0 $1,386,973

$1,807,438 $78,081 $0 $1,885,519

$2,362,657 $84,467 $0 $2,447,125

$2,970,110 $91,224 $0 $3,061,334

Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets Total Assets

$65,000 $13,500 $51,500 $985,674

$65,000 $37,500 $27,500 $1,414,473

$65,000 $61,500 $3,500 $1,889,019

$65,000 $85,500 ($20,500) $2,426,625

$65,000 $109,500 ($44,500) $3,016,834

Year 1

Year 2

Year 3

Year 4

Year 5

Current Liabilities Accounts Payable Current Borrowing Other Current Liabilities

$141,197 $0 $10,000

$123,589 $0 $10,000

$127,858 $0 $10,000

$144,342 $0 $10,000

$157,970 $0 $10,000

Subtotal Current Liabilities

$151,197

$133,589

$137,858

$154,342

$167,970

Long-term Liabilities Total Liabilities

$40,400 $191,597

$30,800 $164,389

$21,200 $159,058

$11,600 $165,942

$2,000 $169,970

Assets

Liabilities and Capital

Paid-in Capital

$900,000

$900,000

$900,000

$900,000

$900,000

($324,500) $218,577 $794,077

($105,923) $456,007 $1,250,084

$350,084 $479,877 $1,729,961

$829,961 $530,721 $2,260,682

$1,360,682 $586,182 $2,846,864

Total Liabilities and Capital

$985,674

$1,414,473

$1,889,019

$2,426,625

$3,016,834

Net Worth

$794,077

$1,250,084

$1,729,961

$2,260,682

$2,846,864

Retained Earnings Earnings Total Capital

Page 33

The Fire Fountain Grille 8.6 Business Ratios The table follows with our main business ratios. We do intend to improve gross margin, collection days, sales and labor controls. Our ratios are compared to industry ratios for Steak Restaurants - SIC code 5812.0802.

Page 34

The Fire Fountain Grille Table: Ratios Ratio Analysis Sales Growth Percent of Total Assets Inventory Other Current Assets Total Current Assets Long-term Assets Total Assets Current Liabilities Long-term Liabilities Total Liabilities Net Worth Percent of Sales Sales Gross Margin Selling, General & Administrative Expenses Advertising Expenses Profit Before Interest and Taxes Main Ratios Current Quick Total Debt to Total Assets Pre-tax Return on Net Worth Pre-tax Return on Assets

Year 1 n.a.

Year 2 81.82%

Year 3 8.00%

Year 4 8.00%

Year 5 Industry Profile 8.00% 6.96%

6.22% 0.00% 94.78% 5.22% 100.00%

8.76% 0.00% 98.06% 1.94% 100.00%

4.13% 0.00% 99.81% 0.19% 100.00%

3.48% 0.00% 100.84% -0.84% 100.00%

3.02% 0.00% 101.48% -1.48% 100.00%

3.90% 28.39% 37.68% 62.32% 100.00%

15.34% 4.10% 19.44% 80.56%

9.44% 2.18% 11.62% 88.38%

7.30% 1.12% 8.42% 91.58%

6.36% 0.48% 6.84% 93.16%

5.57% 0.07% 5.63% 94.37%

19.17% 29.21% 48.38% 51.62%

100.00% 61.69%

100.00% 61.68%

100.00% 62.14%

100.00% 62.52%

100.00% 62.86%

100.00% 59.31%

44.89% 1.00% 20.19%

42.42% 1.00% 22.90%

43.12% 1.09% 22.59%

43.35% 1.19% 22.75%

42.99% 1.30% 23.57%

39.09% 2.75% 1.59%

6.18

10.38

13.68

15.86

18.23

1.26

5.77 19.44% 32.38% 26.08%

9.45 11.62% 42.92% 37.93%

13.11 8.42% 33.12% 30.33%

15.31 6.84% 27.62% 25.73%

17.68 5.63% 24.59% 23.20%

0.87 3.27% 54.38% 7.17%

Additional Ratios

Year 1

Year 2

Year 3

Year 4

Year 5

Net Profit Margin Return on Equity

16.84% 27.53%

19.32% 36.48%

18.83% 27.74%

19.28% 23.48%

19.72% 20.59%

n.a n.a

10.91 6.16 27 1.32

7.91 12.17 32 1.67

7.82 12.17 29 1.35

10.50 12.17 28 1.13

10.49 12.17 29 0.99

n.a n.a n.a n.a

0.24 0.79

0.13 0.81

0.09 0.87

0.07 0.93

0.06 0.99

n.a n.a

$782,977 53.17

$1,253,384 138.00

$1,747,661 201.35

$2,292,782 347.11

$2,893,364 936.72

n.a n.a

0.76 15% 5.77 1.63 0.00

0.60 9% 9.45 1.89 0.00

0.74 7% 13.11 1.47 0.00

0.88 6% 15.31 1.22 0.00

1.01 6% 17.68 1.04 0.00

n.a n.a n.a n.a n.a

Activity Ratios Inventory Turnover Accounts Payable Turnover Payment Days Total Asset Turnover Debt Ratios Debt to Net Worth Current Liab. to Liab. Liquidity Ratios Net Working Capital Interest Coverage Additional Ratios Assets to Sales Current Debt/Total Assets Acid Test Sales/Net Worth Dividend Payout

Page 35

The Fire Fountain Grille 8.7 Long-term Plan Our long term plan is to continue to maintain a cash flow of 19-20% while increasing sales annually, thereby increasing ac tual dollars earned by our investors, principals and staff.

Page 36

Appendix Table: Sales Forecast Sales Forecast Sales Food Beverage Liquor Beer Wine Total Sales 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

0%

$0

$0

$0

$0

$0

$163,188

$144,048

$154,627

$135,464

$138,591

$138,591

$183,844

0% 0% 0%

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$7,582 $9,127 $12,677

$6,903 $7,911 $11,646

$7,155 $8,439 $12,517

$4,956 $7,764 $10,308

$5,133 $7,955 $11,018

$5,133 $7,955 $11,018

$6,726 $10,739 $14,617

0%

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$8,024 $200,598

$6,460 $176,968

$6,060 $188,798

$6,707 $165,199

$8,401 $171,098

$8,401 $171,098

$8,272 $224,198

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

Food Beverage

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$59,500 $514

$52,500 $468

$56,000 $485

$47,600 $336

$47,850 $348

$46,400 $348

$49,856 $456

Liquor Beer

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$1,315 $2,471

$1,139 $2,270

$1,215 $2,439

$1,052 $1,921

$1,011 $2,054

$943 $1,960

$1,274 $2,601

Wine Subtotal Direct Cost of Sales

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$1,566 $65,366

$1,478 $57,855

$1,386 $61,525

$1,477 $52,386

$1,780 $53,043

$1,566 $51,217

$1,542 $55,729

Page 1

Appendix Table: Personnel Personnel Plan Month 1

Month 2

Month 3

Month 4

Month 5

Production Personnel Assistant Chef

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

$0

$0

$0

$0

$0

$300

$240

$240

$240

$240

$240

$250

Lead Cook/Grill

$0

$0

$0

$0

$0

$1,700

$1,440

$1,440

$1,440

$1,440

$1,440

$1,440

Grill Two Broiler Cook One

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$700 $1,600

$580 $1,440

$580 $1,440

$580 $1,440

$580 $1,440

$580 $1,440

$580 $1,440

Broiler Cook Two Fry Cook One Fry Cook Two

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$700 $1,400 $700

$580 $1,200 $600

$580 $1,200 $600

$580 $1,200 $600

$580 $1,200 $600

$580 $1,200 $600

$580 $1,200 $600

Wheel Man One Wheel Man Two

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$700 $500

$600 $380

$600 $380

$600 $380

$600 $380

$600 $380

$600 $380

Salad Cook One

$0

$0

$0

$0

$0

$1,400

$1,200

$1,200

$1,200

$1,200

$1,200

$1,200

Salad Cook Two Prep Cook One Prep Cook Two

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$700 $1,300 $1,300

$600 $1,160 $1,160

$600 $1,160 $1,160

$600 $1,160 $1,160

$600 $1,160 $1,160

$600 $1,160 $1,160

$600 $1,160 $1,160

Prep Cook Three Dish One Dish Two

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$1,300 $1,200 $750

$1,160 $1,040 $600

$1,160 $1,040 $600

$1,160 $1,040 $600

$1,160 $1,040 $600

$1,160 $1,040 $600

$1,160 $1,040 $600

Subtotal

$0

$0

$0

$0

$0

$16,250

$13,980

$13,980

$13,980

$13,980

$13,980

$13,990

One (1) Floor Supervisor One (1) Window Expediter Ten (10) Full-time Servers

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$300 $500 $4,260

$280 $480 $3,834

$280 $480 $3,834

$280 $480 $3,834

$280 $480 $3,834

$280 $480 $3,834

$280 $480 $3,834

Ten (10) Part-time Servers Four (4) Full-time Bartenders

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$2,130 $2,500

$1,917 $2,240

$1,917 $2,240

$1,917 $2,240

$1,917 $2,240

$1,917 $2,240

$1,917 $2,240

Two (2) Full-time Hostesses

$0

$0

$0

$0

$0

$800

$720

$720

$720

$720

$720

$720

Three (3) Part-time Hostesses

$0

$0

$0

$0

$0

$400

$360

$360

$360

$360

$360

$360

Four (4) Bussers Food Runner

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$400 $500

$350 $500

$350 $500

$350 $500

$350 $500

$350 $500

$350 $500

Subtotal

$0

$0

$0

$0

$0

$11,790

$10,681

$10,681

$10,681

$10,681

$10,681

$10,681

Managing Partner 1 Managing Partner 2

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$2,500 $2,500

$2,500 $2,500

$2,500 $2,500

$2,500 $2,500

$2,500 $2,500

$2,500 $2,500

$2,500 $2,500

Managing Partner 3

$0

$0

$0

$0

$0

$2,500

$2,500

$2,500

$2,500

$2,500

$2,500

$2,500

Managing Partner 4

$0

$0

$0

$0

$0

$2,500

$2,500

$2,500

$2,500

$2,500

$2,500

$2,500

Bookkeeper Subtotal

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$1,600 $11,600

$1,600 $11,600

$1,600 $11,600

$1,600 $11,600

$1,600 $11,600

$1,600 $11,600

$1,600 $11,600

Sales and Marketing Personnel

General and Administrative Personnel

Page 2

Appendix Other Personnel Event by Event Basis TBD Event by Event Basis TBD

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

Subtotal

$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

$0

$0

$0

$0

$0

$39,640

$36,261

$36,261

$36,261

$36,261

$36,261

$36,271

Page 3

Appendix Table: General Assumptions General Assumptions Plan Month Current Interest Rate

Month 1 1 9.00%

Month 2 2 9.00%

Month 3 3 9.00%

Month 4 4 9.00%

Month 5 5 9.00%

Month 6 6 9.00%

Month 7 7 9.00%

Month 8 8 9.00%

Month 9 9 9.00%

Month 10 10 9.00%

Month 11 11 9.00%

Month 12 12 9.00%

Long-term Interest Rate

11.00%

11.00%

11.00%

11.00%

11.00%

11.00%

11.00%

11.00%

11.00%

11.00%

11.00%

11.00%

Tax Rate Other

30.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

15.00% 0

Page 4

Appendix Table: Profit and Loss Pro Forma Profit and Loss Month 1 $0 $0

Month 2 $0 $0

Month 3 $0 $0

Month 4 $0 $0

Month 5 $0 $0

Month 6 $200,598 $65,366

Month 7 $176,968 $57,855

Month 8 $188,798 $61,525

Month 9 $165,199 $52,386

Month 10 $171,098 $53,043

Month 11 $171,098 $51,217

Month 12 $224,198 $55,729

Production Payroll

$0

$0

$0

$0

$0

$16,250

$13,980

$13,980

$13,980

$13,980

$13,980

$13,990

Other Costs of Goods Total Cost of Sales

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $81,616

$0 $71,835

$0 $75,505

$0 $66,366

$0 $67,023

$0 $65,197

$0 $69,719

$0 0.00%

$0 0.00%

$0 0.00%

$0 0.00%

$0 0.00%

$118,982 59.31%

$105,133 59.41%

$113,293 60.01%

$98,833 59.83%

$104,075 60.83%

$105,901 61.89%

$154,479 68.90%

Sales and Marketing Expenses Sales and Marketing Payroll Operating Supplies

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$11,790 $2,000

$10,681 $1,760

$10,681 $1,890

$10,681 $1,650

$10,681 $1,720

$10,681 $1,720

$10,681 $2,200

Janitorial Repairs Aprons, Towels & Napkins

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$1,500 $250 $1,000

$1,500 $250 $1,000

$1,500 $250 $1,000

$1,500 $250 $1,000

$1,500 $250 $1,000

$1,500 $250 $1,000

$1,500 $250 $1,000

Menus

$0

$0

$0

$0

$0

$150

$150

$150

$150

$150

$150

$150

Miscellaneous Supplies Miscellaneous Purchases

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$250 $50,000

$250 $250

$250 $250

$250 $250

$250 $250

$250 $250

$250 $250

Complimentary Meals or Drinks For PR Advertising/Promotion

$0

$0

$0

$0

$0

$750

$750

$750

$750

$750

$750

$750

$0

$0

$0

$0

$0

$500

$500

$500

$500

$500

$0

$500

Credit Card Charges

$0

$0

$0

$0

$0

$1,760

$1,500

$1,500

$1,500

$1,500

$1,500

$1,500

Fraud Credit Cards/Checks Professional Fees

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$150 $250

$150 $250

$150 $250

$150 $0

$150 $0

$150 $0

$150 $250

Membership Fees

$0

$0

$0

$0

$0

$75

$75

$75

$75

$75

$75

$75

Uniforms

$0

$0

$0

$0

$0

$150

$150

$150

$0

$0

$0

$150

Travel Employee Discounts

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $500

$0 $500

$0 $500

$0 $500

$0 $500

$0 $500

$0 $500

Total Sales and Marketing Expenses

$0

$0

$0

$0

$0

$71,075

$19,716

$19,846

$19,206

$19,276

$18,776

$20,156

0.00%

0.00%

0.00%

0.00%

0.00%

35.43%

11.14%

10.51%

11.63%

11.27%

10.97%

8.99%

$0

$0

$0

$0

$0

$11,600

$11,600

$11,600

$11,600

$11,600

$11,600

$11,600

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

Sales Direct Cost of Sales

Gross Margin Gross Margin % Operating Expenses

Sales and Marketing % General and Administrative Expenses General and Administrative Payroll Sales and Marketing and Other Expenses

Page 5

Appendix Depreciation

($100)

($100)

($100)

($100)

($100)

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

$2,000

Leased Equipment Utilities Amortization

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$150 $8,000 $5,000

$150 $7,500 $5,000

$150 $8,500 $5,000

$150 $8,000 $5,000

$150 $8,500 $5,000

$150 $8,500 $5,000

$150 $9,000 $5,000

Debt Service Insurance Excess Insurance

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $3,000 $500

$0 $3,000 $500

$0 $3,000 $500

$0 $3,000 $500

. $3,000 $500

$0 $3,000 $500

$25,000 $3,000 $500

Property Taxes

$0

$0

$0

$0

$0

$1,500

$1,500

$1,500

$1,500

$1,500

$1,500

$1,500

Excess Taxes Vacation Accrual

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$500 $350

$500 $350

$500 $350

$500 $350

$500 $350

$500 $350

$500 $350

Base Rent Percentage Rent CAM Rent

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$6,000 $2,000 $750

$6,000 $1,760 $750

$6,000 $1,887 $750

$6,000 $1,650 $750

$6,000 $1,710 $750

$6,000 $1,710 $750

$6,000 $2,241 $750

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$3,964 $0

$3,626 $0

$3,626 $0

$3,626 $0

$3,626 $0

$3,626 $0

$3,627 $0

($100)

($100)

($100)

($100)

($100)

$45,314

$44,236

$45,363

$44,626

$45,186

$45,186

$71,218

0.00%

0.00%

0.00%

0.00%

0.00%

22.59%

25.00%

24.03%

27.01%

26.41%

26.41%

31.77%

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $10,000

Payroll Taxes Other General and Administrative Expenses Total General and Administrative Expenses General and Administrative %

10%

Other Expenses: Other Payroll Consultants Expansion Fund Total Other Expenses

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$10,000

Other %

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

0.00%

4.46%

Total Operating Expenses

($100)

($100)

($100)

($100)

($100)

$116,389

$63,952

$65,209

$63,832

$64,462

$63,962

$101,374

Profit Before Interest and Taxes

$100

$100

$100

$100

$100

$2,593

$41,181

$48,084

$35,001

$39,613

$41,939

$53,105

EBITDA Interest Expense

$0 $451

$0 $444

$0 $436

$0 $429

$0 $422

$4,593 $414

$43,181 $407

$50,084 $400

$37,001 $392

$41,613 $385

$43,939 $378

$55,105 $370

Taxes Incurred

($105)

($52)

($50)

($49)

($48)

$327

$6,116

$7,153

$5,191

$5,884

$6,234

$7,910

($246) 0.00%

($292) 0.00%

($286) 0.00%

($280) 0.00%

($273) 0.00%

$1,852 0.92%

$34,658 19.58%

$40,532 21.47%

$29,417 17.81%

$33,344 19.49%

$35,327 20.65%

$44,824 19.99%

Net Profit Net Profit/Sales

Page 6

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

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$200,598 $200,598

$176,968 $176,968

$188,798 $188,798

$165,199 $165,199

$171,098 $171,098

$171,098 $171,098

$224,198 $224,198

Cash Received Cash from Operations Cash Sales Subtotal Cash from Operations Additional Cash Received Sales Tax, VAT, HST/GST Received

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

$0

New Current Borrowing New Other Liabilities (interest-free)

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$0 $0

$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 Sales of Long-term Assets New Investment Received

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

$0 $0 $0

Subtotal Cash Received

$0

$0

$0

$0

$0

$200,598

$176,968

$188,798

$165,199

$171,098

$171,098

$224,198

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

0.00%

Expenditures from Operations Cash Spending

$0

$0

$0

$0

$0

$39,640

$36,261

$36,261

$36,261

$36,261

$36,261

$36,271

Bill Payments Subtotal Spent on Operations

$10,012 $10,012

$347 $347

$392 $392

$386 $386

$379 $379

$7,995 $47,635

$224,568 $260,829

$96,396 $132,657

$113,157 $149,418

$87,893 $124,154

$100,059 $136,320

$97,187 $133,458

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

$800 $0

$800 $0

$800 $0

$800 $0

$800 $0

$800 $0

$800 $0

$800 $0

$800 $0

$800 $0

$800 $0

$800 $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

$10,812

$1,147

$1,192

$1,186

$1,179

$48,435

$261,629

$133,457

$150,218

$124,954

$137,120

$134,258

Long-term Liabilities Principal Repayment Purchase Other Current Assets

Subtotal Cash Spent Net Cash Flow

($10,812)

($1,147)

($1,192)

($1,186)

($1,179)

$152,163

($84,661)

$55,341

$14,981

$46,144

$33,978

$89,940

Cash Balance

$569,688

$568,541

$567,349

$566,164

$564,984

$717,148

$632,487

$687,828

$702,809

$748,954

$782,932

$872,872

Page 7

Appendix Table: Balance Sheet Pro Forma Balance Sheet Assets

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

Starting Balances

Current Assets Cash Inventory

$580,500 $0

$569,688 $0

$568,541 $0

$567,349 $0

$566,164 $0

$564,984 $0

$717,148 $71,903

$632,487 $63,641

$687,828 $67,678

$702,809 $57,625

$748,954 $58,347

$782,932 $56,339

$872,872 $61,302

Other Current Assets Total Current Assets

$0 $580,500

$0 $569,688

$0 $568,541

$0 $567,349

$0 $566,164

$0 $564,984

$0 $789,050

$0 $696,127

$0 $755,506

$0 $760,434

$0 $807,301

$0 $839,271

$0 $934,174

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$65,000

$0

($100)

($200)

($300)

($400)

($500)

$1,500

$3,500

$5,500

$7,500

$9,500

$11,500

$13,500

$65,000 $645,500

$65,100 $634,788

$65,200 $633,741

$65,300 $632,649

$65,400 $631,564

$65,500 $630,484

$63,500 $852,550

$61,500 $757,627

$59,500 $815,006

$57,500 $817,934

$55,500 $862,801

$53,500 $892,771

$51,500 $985,674

Month 1

Month 2

Month 3

Month 4

Month 5

Month 6

Month 7

Month 8

Month 9

Month 10

Month 11

Month 12

Long-term Assets Long-term Assets Accumulated Depreciation Total Long-term Assets Total Assets Liabilities and Capital Current Liabilities Accounts Payable

$10,000

$334

$379

$373

$367

$361

$221,375

$92,594

$110,241

$84,552

$96,875

$92,318

$141,197

Current Borrowing Other Current Liabilities

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

$0 $10,000

Subtotal Current Liabilities

$20,000

$10,334

$10,379

$10,373

$10,367

$10,361

$231,375

$102,594

$120,241

$94,552

$106,875

$102,318

$151,197

Long-term Liabilities

$50,000

$49,200

$48,400

$47,600

$46,800

$46,000

$45,200

$44,400

$43,600

$42,800

$42,000

$41,200

$40,400

Total Liabilities

$70,000

$59,534

$58,779

$57,973

$57,167

$56,361

$276,575

$146,994

$163,841

$137,352

$148,875

$143,518

$191,597

Paid-in Capital

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

$900,000

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

($324,500)

Earnings Total Capital

$0 $575,500

($246) $575,254

($538) $574,962

($824) $574,676

($1,103) $574,397

($1,377) $574,123

$475 $575,975

$35,133 $610,633

$75,665 $651,165

$105,082 $680,582

$138,426 $713,926

$173,753 $749,253

$218,577 $794,077

Total Liabilities and Capital

$645,500

$634,788

$633,741

$632,649

$631,564

$630,484

$852,550

$757,627

$815,006

$817,934

$862,801

$892,771

$985,674

Net Worth

$575,500

$575,254

$574,962

$574,676

$574,397

$574,123

$575,975

$610,633

$651,165

$680,582

$713,926

$749,253

$794,077

Retained Earnings

Page 8

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