Production & Operation Management - Assignment

ASSIGNMENT
on
Business Plan
S UBMITTE d t o : S UBMITTE d by :
Abdullah M. Taher
Faculty, School of Business
Course: Production & Operation Management
[B2602] AUB, Dhanmondi Campus
Dhaka, Bangladesh.
Shantanu Das
BBA, 29th Batch
(B) ID:
200712883
AUB, Dhanmondi Campus
Dhaka, Bangladesh.
Date of Submission: 09-03-2010.

Copyright  2010, GlobeNet Wireless
Broadband Page 2 of 28
BUSINESS
PLAN
GlobeNet Wireless Broadband [Wi-MAX ISP]
Prepared by:
Serial Name ID
1 Shantanu Das 200712883
2 Sk. Saiful Islam Rozin 200710522
3 Mehedi Hassan 200710466
4 Sayed Sayem Ali 200710469
5 A.M.D. Abu Sufian Rashed 200710487

Copyright  2010, GlobeNet Wireless
Broadband Page 3 of 28
Table of Contents
Serial Subject Co-subject Page
1 Executive Summary 03
1.1 Mission 04
1.2 Keys to Success 04
1.3 Objectives 04
2 Company Summary 05
2.1 Company Ownership 05
2.2 Start-up Summary 05
3 Service 07
4 Market Analysis Summary 08
4.1 Market Segmentation 08
4.2 Target Market Segment Strategy 09
4.3 Service Business Analysis 09
4.3.1 Competition and Buying Patterns 10
5 Strategy and Implementation
Summary 10
5.1 Competitive Edge 10
5.2 Marketing Strategy 11
5.3 Sales Strategy 11
5.3.1 Sales Forecast 11
5.4 Milestones 13
6 Web Plan Summary 14
6.1 Website Marketing Strategy 14
6.2 Development Requirements 14
7 Management Summary 14
7.1 Personnel Plan 15
8 Financial Plan 15
8.1 Break-even Analysis 15
8.2 Projected Profit and Loss 16
8.3 Projected Cash Flow 19
8.4 Projected Balance Sheet 20
8.5 Business Ratios 21
9 Appendix 23

Page 4 of 28Copyright  2010, GlobeNet Wireless
Broadband
Executive Summary
GlobeNet Wireless Broadband is an innovative start-up company that provides
wireless broadband internet connections to several Dhaka Metropolitan Areas.
Utilizing Wi-MAX technology and proprietary antennas and repeaters,
GlobeNet will be able to serve a larger area with broadband Internet
connections.
GlobeNet was been founded by Fahad Karim. With a MBA and an
undergraduate Computer Science degree from the Harvard University (USA),
Fahad has the skills to execute on this well-researched business plan. Fahad
spent two years in the Karim Associates, which gave him not only an incredible
and reasonable boost in confidence to accomplish a business venture, but also
provided him with solid project management skills and experience.
The market for wireless broadband Internet connections in Bangladesh is new but is
widely open. Demand for traditional broadband connections is surpassing
conservative forecasts. The wireless market is even more exciting due to the
significantly lower costs needed in terms of delivery infrastructure. As
GlobeNet's customer base grows, costs decrease through scales of
economy, creating an even more compelling argument for GlobeNet's
existence.
GlobeNet has targeted three distinct groups. The first is students, a market
segment that uses the Internet the most and also have high expectations
regarding the speed of the connection. The second group is professionals,
people with disposable income, not a lot of excessive time on their hands, and a
group that uses the Internet a fair amount, both personally as well as
professionally. The last group that will be targeted is techies. This group is the
early adopters of any type of technology and spend incredible amounts of
time immersed in Internet technology.
GlobeNet is a compelling business concept that leverages advances in
technology and proprietary tools to offer a market need at below market
prices. In addition to earning great margins with low infrastructure costs,
margins increase as the customer base increases. This exciting business plan has a
high likelihood of success with Fahad Karim responsible for the execution of
it. The business will earn modest profits in year two, increasing exponentially in
year three. Net profit is forecasted to be commensurate in years two and three.

Page 5 of 28Copyright  2010, GlobeNet Wireless
Broadband
1.1 Mission
It is GlobeNet Wireless's mission to provide fast, wireless Internet access at a
reasonable price. The most important thing to remember is that every
customer must be satisfied with our services.
1.2 Keys to Success
 Practice disciplined growth.
 Reach profitability by year two.
 Ensure that the customer's needs are met and maintain a 90%
customer retention ratio.
1.3 Objectives
 Provide, fast, reliable, wireless Internet access.
 Treat customers with the upmost respect.
 Become profitable within two years.

Page 6 of 28Copyright  2010, GlobeNet Wireless
Broadband
Company Summary
GlobeNet Wireless will be formed in 2011 to offer an inexpensive, wireless
broadband Internet connection to compete with DSL or cable offerings. Using
Wi-MAX technology, it is inexpensive to set up a neighborhood network. The
company was founded by Fahad Karim. Fahad will rely on outside investors for
the necessary start-up costs.
2.1 Company Ownership
GlobeNet Broadband Wireless is a Wi-NET BD Pvt. Ltd. company with Fahad
Karim as the principal and majority owner.
2.2 Start-up Summary
Equipment that will be needed is as follows:
 Three computer workstations;
 Wireless access point;
 Five repeaters;
 Five antennas;
 Assorted office equipment and supplies.

Page 7 of 28Copyright  2010, GlobeNet Wireless
Broadband
Start-up Funding
Start-up Expenses to Fund $9,500
Start-up Assets to Fund $60,500
Total Funding Required $70,000
Assets
Non-cash Assets from Start-up $5,000
Cash Requirements from Start-up $55,500
Additional Cash Raised $0
Cash Balance on Starting Date $55,500
Total Assets $60,500
Liabilities and Capital
Liabilities
Current Borrowing $0
Long-term Liabilities $0
Accounts Payable (Outstanding Bills)$0
Other Current Liabilities (interest-free) $0
Total Liabilities $0
Capital
Planned Investment
Investor 1 $15,000
Investor 2 $55,000
Additional Investment Requirement $0
Total Planned Investment $70,000
Loss at Start-up (Start-up Expenses) ($9,500)
Total Capital $60,500
Total Capital and Liabilities $60,500
Total Funding $70,000

Page 8 of 28Copyright  2010, GlobeNet Wireless
Broadband
Start-up
Requirements
Start-up Expenses
Legal $2,000
Stationery etc. $100
Consultants $1,000
Insurance $200
Rent $200
Research and Development $1,000
Expensed Equipment $5,000
Total Start-up Expenses $9,500
Start-up Assets
Cash Required $55,500
Other Current Assets $0
Long-term Assets $5,000
Total Assets $60,500
Total Requirements $70,000
Services
GlobeNet offers wireless broadband Internet access. The service is DSL speed with
customers only needing a Wi-MAX card/modem and to live within range of the
signal which covers a thirty block radius currently. There are plans to enlarge
the coverage area as more customers sign up.
Wi-MAX technology is based off of 2.4 Mhz spectrum wireless transmissions.
Using the same wave lengths that some cordless phones use, the Internet
signals are broadcasted out through the neighborhood. With the supplied
password and a Wi-MAX receiver in each customer's computer, customers will have
fast, wireless Internet connections.

Page 9 of 28Copyright  2010, GlobeNet Wireless
Broadband
Market Analysis Summary
Within the last three years there has been a proliferation of broadband
Internet connections. With so many people enjoying fast connections at work,
they are no longer willing to deal with a dial-up connection at home. With the
advent of Wi-MAX technology, customers can now enjoy a fast connection
without having to lay expensive cables since the signal is sent via radio waves. The
targeted market segments are: students, professionals, techies.
4.1 Market Segmentation
The market can be segmented into three distinct groups:
 Students: these are people currently in academia and are accustomed to
fast connections and are willing to pay for it. This group uses the
Internet the most, whether they are trading MP3s or downloading
videos.
 Professionals: this group conducts a fair amount of business over the
Internet, whether banking, e-commerce, or communications.
 Techies: this group embraces technology as they enjoy challenging
themselves with technology and the complexity it brings.
Other than the students, GlobeNet' customers are fairly affluent (household
income of >$50,000) and spend their money on technology offerings, whether it
is digital cable, cellular service, or broadband Internet connections. The target
customers are also generally well educated with 65% having a college degree
and 20% having a graduate degree. Combining several demographic factors,
GlobeNet arrives at the following primary customer profile:
 Spends 10 hours a week on the Internet away from home.
 Has purchased something from a website at least once within the last
two months.
 Educated with at least some course work for an undergraduate degree.
 Household income of at least $50,000.

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Broadband
CAGR
4.2 Target Market Segment Strategy
GlobeNet has chosen the three aforementioned target markets due to their
adoption of broadband Internet technology. It is these three groups that are
most likely to use a fast connection and the most willing to pay a premium for
the connection.
4.3 Service Business Analysis
There are three main participants within the consumer broadband Internet
market.
 DSL (digital subscriber line). A connection that utilizes the copper
phone lines as the method of transmission.
 Cable. A connection that uses cable TV wiring for transmission.
 Satellite connections. These use satellites, in orbit to provide "cable"
TV as well as Internet connections to residential and remote consumers.
Market Analysis
Year 1 Year 2 Year 3 Year 4 Year 5
Potential
Customers Growth
Students 9% 54,000 58,860 64,157 69,931 76,225 9.00%
Professionals 8% 34,000 36,720 39,658 42,831 46,257 8.00%
Techies 11% 10,000 11,100 12,321 13,676 15,180 11.00%
Total 8.87% 98,000 106,680 116,136 126,438 137,662 8.87%

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4.3.1 Competition and Buying Patterns
As mentioned in the previous section, DSL, cable, and satellite access are the
competitors in the broadband market. Consumer buying patterns are based on
two factors:
 Availability: not every type of broadband connection is available to
every consumer. Consumers often pick service providers based on what is
available to them.
 Convenience: this is often based on where the outlet cords are based in
the house, whether the computer will be located closer to the cable TV
or nearer to a phone jack.
Strategy and Implementation Summary
Simply put, GlobeNet' strategy is to offer a service, demanded by customers, at
a price that undercuts the competition. This will be accomplished, not by
accepting below-market margins, but by leveraging technology, to help drive
GlobeNet' costs down. Awareness regarding GlobeNet' services will be
generated effectively and inexpensively to the specific target segments that
GlobeNet has focused on.
5.1 Competitive Edge
GlobeNet' competitive edge is the effective and efficient use of Wi-MAX
technology. Wi-MAX, while a fairly recent technology, has been adopted by
several different service providers as well as used for home-based networks.
What provides GlobeNet with a competitive edge is its efficient use of the
technology. GlobeNet has developed a proprietary antenna that allows for signal
transmission over great distances with less signal loss. Additionally, GlobeNet
has significantly reduced administrative costs by having most administrative
activities like marketing, sales, and service details administered via the Internet.

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5.2 Marketing Strategy
As the name implies, GlobeNet will be using a GlobeNet approach to
developing awareness of the offered services. GlobeNet will adopt a multi-
pronged marketing approach:
 Advertising/postings with local retailers and commercial businesses.
This will provide GlobeNet with great visibility in the exact community that
it operates in.
 Mailings. GlobeNet will adopt a targeted mailing campaign to local
residents.
 Website. GlobeNet will leverage its website as a comprehensive and
efficient source of marketing/sales information.
5.3 Sales Strategy
The sales strategy that GlobeNet will adopt is based on developing an
awareness of GlobeNet' service as a viable alternative to Cable and DSL within the
community. The message used will be that you can receive broadband speed
connections to your computer, wherever it may be, even your laptop on your
front lawn, at a price that is a fraction of the current competitors'. This will be
done with targeted advertising with local retail/commercial establishments in
the area. Additionally, GlobeNet will rely on mailings to get the word out. Lastly,
GlobeNet will have a website for marketing, sales, and administrative
purposes.
5.3.1 Sales Forecast
GlobeNet has developed a conservative sales forecast. Adoption rates of
customers are fairly steady from one month to the next. A conservative
approach has been adopted to minimize any external variables that may effect
future operations.
GlobeNet believes that it will experience extensive growth for several years for
several reasons. The first is the general adoption of broadband connections
which has been encouraging for the last several years. Another reason
GlobeNet believes their forecast to be accurate is it offers a viable, less
expensive alternative to current broadband connections.

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Broadband
Sales Forecast
Year 1 Year 2 Year 3
Sales
Monthly Internet Service $36,584 $132,665 $211,443
Other $0 $0 $0
Total Sales $36,584 $132,665 $211,443
Direct Cost of Sales Year 1 Year 2 Year 3
Administrative costs $1,829 $6,633 $10,572
Other $0 $0 $0
Subtotal Direct Cost of Sales$1,829 $6,633 $10,57 2

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5.4 Milestones
Milestones are a very important aspect of a business plan. They provide
concrete, achievable, yet lofty goals that the business must concentrate on. By
targeting lofty goals, GlobeNet ensures that it is aiming high, therefore it is more
likely to achieve more. The milestones that GlobeNet has chosen are very
specific to the company and will be embraced by all employees.
Milestones
Milestone Start Date End Date Budget Manager Department
Business plan
completion 1/1/2003 2/1/2003 $0 Fahad Management
First 10 customers 1/1/2003 3/30/2003 $0 Fahad Sales
Profitability 1/1/2003 2/1/2004 $0 Fahad Operations
Enlargement of the
network 1/1/2003 2/1/2004 $0 Fahad Operations
Totals $0

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Web Plan Summary
The website will be used for:
 Marketing/sales;
 Administrative functions.
6.1 Website Marketing Strategy
All of GlobeNet' marketing information will be present on the website for
viewing and for downloading/printing. Awareness regarding the website will be
accomplished by inclusion of the website address on all printed materials.
Additionally, the website will have a comprehensive submission procedure to all of
the popular search engines.
6.2 Development Requirements
The website will be developed in-house by leveraging interns.
Management Summary
Fahad Karim, founder and president will be the anchor of the management
team. Fahad received his undergraduate degree in computer science from the
HARVARD University. While Fahad enjoyed the course work he recognized that it
was not something that he was interested in pursuing as a career. Fahad
decided that it would be in his best interest to study for an MBA, however,
he was not immediately ready to do this. So Fahad headed off to Ghana with
the Peace Corps to develop community-based trading systems. Fahad's Peace
Corp experience was invaluable, providing him with extensive project
management experience as well as giving him confidence that he could
accomplish anything he set his mind out to do.
After getting back to the States, Fahad began the MBA program at the
University of Chicago. Fahad's course of study concentrated on
entrepreneurial ventures, recognizing at some point his desire to start his own
business. Near the end of his second year, Fahad began to hear about Wi-
MAX technology. He became interested in what he saw was a strong market
need for inexpensive broadband Internet connections transmitted wirelessly, thereby
significantly decreasing delivery costs. Fahad formed GlobeNet Wireless to
fulfill this market need.

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Broadband
7.1 Personnel Plan
The two main employees beyond Fahad are:
 Technician: this position is responsible for the smooth operation of the
wireless network as well as the website.
 Administration: this is a general customer service position, assisting in
sales and support.
Personnel Plan
Year 1 Year 2 Year 3
President $24,000 $36,000 $48,000
Technician $19,800 $21,600 $21,600
Administration $15,000 $18,000 $18,000
Total People 3 3 3
Total Payroll $58,800 $75,600 $87,600
Financial Plan
The following sections outline important financial information.
8.1 Break-even Analysis
Average per-unit revenue: based on the $20 monthly access fee. Average
per-unit variable cost: costs based on infrastructure, and administrative
costs.
Estimated monthly fixed costs: Internet connections costs.

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Break-even Analysis
Monthly Revenue Break-even $8,072
Assumptions:
Average Percent Variable Cost 5%
Estimated Monthly Fixed Cost $7,668
8.2 Projected Profit and Loss
The following table and charts show the Projected Profit and Loss.

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Page 19 ofCopyright  2010, GlobeNet Wireless
Broadband
Pro Forma Profit and Loss
Year 1 Year 2 Year 3
Sales $36,584 $132,665 $211,443
Direct Cost of Sales $1,829 $6,633 $10,572
Other Costs of Sales $0 $0 $0
Total Cost of Sales $1,829 $6,633 $10,572
Gross Margin $34,755 $126,032 $200,871
Gross Margin % 95.00% 95.00% 95.00%
Expenses
Payroll $58,800 $75,600 $87,600
Sales and Marketing and Other Expenses $2,400 $5,600 $12,000
Depreciation $996 $1,002 $1,002
Rent $2,400 $2,400 $2,400
Utilities $9,600 $13,000 $15,000
Insurance $3,000 $3,000 $3,000
Payroll Taxes $8,820 $11,340 $13,140
Other $6,000 $6,000 $6,000
Total Operating Expenses $92,016 $117,942 $140,142
Profit Before Interest and Taxes ($57,261) $8,090 $60,729
EBITDA ($56,265) $9,092 $61,731
Interest Expense $0 $0 $0
Taxes Incurred $0 $2,427 $18,219
Net Profit ($57,261) $5,663 $42,510
Net Profit/Sales -156.52% 4.27% 20.10%

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8.3 Projected Cash Flow
The following table and chart display the Projected Cash Flow.
Pro Forma Cash Flow
Year 1 Year 2 Year 3
Cash Received
Cash from Operations
Cash Sales $36,584 $132,665 $211,443
Subtotal Cash from Operations $36,584 $132,665 $211,443
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 $0 $0 $0
Subtotal Cash Received $36,584 $132,665 $211,443
Expenditures Year 1 Year 2 Year 3
Expenditures from Operations
Cash Spending $58,800 $75,600 $87,600
Bill Payments $31,112 $49,195 $77,871
Subtotal Spent on Operations $89,912 $124,795 $165,471

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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 $0 $0 $0
Purchase Other Current Assets $0 $0 $0
Purchase Long-term Assets $0 $0 $0
Dividends $0 $0 $0
Subtotal Cash Spent $89,912 $124,795 $165,471
Net Cash Flow ($53,328) $7,870 $45,972
Cash Balance $2,172 $10,042 $56,014
8.4 Projected Balance Sheet
The following table presents the Projected Balance Sheet.
Pro Forma Balance Sheet
Year 1 Year 2 Year 3
Assets
Current Assets
Cash $2,172 $10,042 $56,014
Other Current Assets $0 $0 $0
Total Current Assets $2,172 $10,042 $56,014
Long-term Assets
Long-term Assets $5,000 $5,000 $5,000
Accumulated Depreciation $996 $1,998 $3,000
Total Long-term Assets $4,004 $3,002 $2,000
Total Assets $6,176 $13,044 $58,014
Liabilities and Capital Year 1 Year 2 Year 3
Current Liabilities
Accounts Payable $2,938 $4,142 $6,603
Current Borrowing $0 $0 $0
Other Current Liabilities $0 $0 $0
Subtotal Current Liabilities $2,938 $4,142 $6,603
Long-term Liabilities $0 $0 $0
Total Liabilities $2,938 $4,142 $6,603

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Paid-in Capital $70,000 $70,000 $70,000
Retained Earnings ($9,500) ($66,761) ($61,098)
Earnings ($57,261) $5,663 $42,510
Total Capital $3,239 $8,902 $51,412
Total Liabilities and Capital $6,176 $13,044 $58,014
Net Worth $3,239 $8,902 $51,412
8.5 Business Ratios
The following table illustrates the different Business Ratios, based on NAICS
code 518111, Internet Service Providers.
Ratio Analysis
Year 1 Year 2 Year 3 Industry Profile
Sales Growth 0.00% 262.63% 59.38% 15.97%
Percent of Total Assets
Other Current Assets 0.00% 0.00% 0.00% 56.35%
Total Current Assets 35.17% 76.99% 96.55% 87.48%
Long-term Assets 64.83% 23.01% 3.45% 12.52%
Total Assets 100.00% 100.00% 100.00% 100.00%
Current Liabilities 47.56% 31.76% 11.38% 30.66%
Long-term Liabilities 0.00% 0.00% 0.00% 23.07%
Total Liabilities 47.56% 31.76% 11.38% 53.73%
Net Worth 52.44% 68.24% 88.62% 46.27%
Percent of Sales
Sales 100.00% 100.00% 100.00% 100.00%
Gross Margin 95.00% 95.00% 95.00% 100.00%
Selling, General & Administrative
Expenses 251.52% 90.73% 74.90% 73 .80%
Advertising Expenses 0.00% 0.00% 0.00% 1.37%
Profit Before Interest and Taxes -156.52% 6.10% 28.72% 1.0 3%
Main Ratios
Current 0.74 2.42 8.48 1.97
Quick 0.74 2.42 8.48 1.50
Total Debt to Total Assets 47.56% 31.76% 11.38% 59.78%
Pre-tax Return on Net Worth -1767.98% 90.88% 118.12% 2.93%
Pre-tax Return on Assets -927.10% 62.02% 104.68% 7.28%

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Additional Ratios Year 1 Year 2 Year 3
Net Profit Margin -156.52% 4.27% 20.10% n.a
Return on Equity -1767.98% 63.62% 82.69% n.a
Activity Ratios
Accounts Payable Turnover 11.59 12.17 12.17 n.a
Payment Days 27 26 24 n.a
Total Asset Turnover 5.92 10.17 3.64 n.a
Debt Ratios
Debt to Net Worth 0.91 0.47 0.13 n.a
Current Liab. to Liab. 1.00 1.00 1.00 n.a
Liquidity Ratios
Net Working Capital ($765) $5,900 $49,412 n.a
Interest Coverage 0.00 0.00 0.00 n.a
Additional Ratios
Assets to Sales 0.17 0.10 0.27 n.a
Current Debt/Total Assets 48% 32% 11% n.a
Acid Test 0.74 2.42 8.48 n.a
Sales/Net Worth 11.30 14.90 4.11 n.a
Dividend Payout 0.00 0.00 0.00 n.a

0Other
.00% 30
10.00%
.00% 10
5
Month 6
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00000000000
30.00%30.00%30.00%30.00%30.00%30.00%.00%.00% 30.00% 30.00% 30
10.00%10.00%10.00%10.00%10.00%10.00%10.00%10.00%10.00%
10.00%10.00%10.00%10.00%10.00%10.00%.00%.00% 10
1211109876
Month 12Month 11Month 10Month 9Month 8Month 7
.00% 3030Tax Rate
10.00%10.00%
Long- term Interest Rate
.00% 10.00% 10.00% 1010
Current Interest Rate
4321Plan Month
Month 5Month 4Month 3Month 2Month 1
General Assumptions
Appendix
Sales Forecast
Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Month
10
Month
11
Month
12
Sales
Monthly Internet
Service 0% $0 $0 $1,200 $2,112 $2,544 $2,887 $3,543 $3,877 $4,322 $4,899 $5,323 $5,877
Other 0% $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total Sales $0 $0 $1,200 $2,112 $2,544 $2,887 $3,543 $3,877 $4,322 $4,899 $5,323 $5,877
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
Administrative
costs $0 $0 $60 $106 $127 $144 $177 $194 $216 $2 45 $266 $294
Other $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal Direct
Cost of Sales $0 $0 $60 $106 $127 $144 $177 $194 $216 $2 45 $266 $294
Personnel Plan
Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Month
10
Month
11
Month
12
President 0% $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000 $2,000
Technician 0% $0 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800 $1,800
Administration 0% $0 $0 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500 $1,500
Total People 1 2 3 3 3 3 3 3 3 3 3 3
Total Payroll $2,000 $3,800 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300

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Pro Forma Profit and Loss
Month Month Month Month Month Month Month Month Month Month Month Month
1 2 3 4 5 6 7 8 9 10 11 12
Sales $0 $0 $1,200 $2,112 $2,544 $2,887 $3,543 $3,877 $4,322 $4,899 $5,323 $5,877
Direct
Cost of
Sales
Other
Costs of
Sales
Total Cost
of Sales
$0 $0 $60 $106 $127 $144 $177 $194 $216 $245 $266 $294
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $60 $106 $127 $144 $177 $194 $216 $245 $266 $294
Gross
Margin
Gross
Margin %
Expenses
Payroll
Sales and
Marketing
and Other
Expenses
Depreciati
on
$0 $0 $1,140 $2,006 $2,417 $2,743 $3,366 $3,683 $4,106 $4,654 $5,057 $5,583
0.00% 0.00%
$2,000 $3,800 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300
$200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200 $200
$83 $83 $83 $83 $83 $83 $83 $83 $83 $83 $83 $83
Rent
Utilities
Insurance
Payroll 15
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
$200
$800
$250
Taxes % $300 $570 $795 $795 $795 $795 $795 $795 $795 $795 $795 $795
Other $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500 $500
Total
Operating
Expenses $4,333 $6,403 $8,128 $8,128 $8,128 $8,128 $8,128 $8,128 $8,128 $8,128 $8,128 $8,128
Profit
Before
Interest
and Taxes
EBITDA
Interest
Expense
Taxes
Incurred
($4,33 ($6,40 ($6,98 ($6,12 ($5,71 ($5,38 ($4,76 ($4,44 ($4,02 ($3,47 ($3,07 ($2,54
3) 3) 8) 2) 1) 5) 2) 5) 2) 4) 1) 5)
($4,25 ($6,32 ($6,90 ($6,03 ($5,62 ($5,30 ($4,67 ($4,36 ($3,93 ($3,39 ($2,98 ($2,46
0) 0) 5) 9) 8) 2) 9) 2) 9) 1) 8) 2)
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Net Profit
Net
($4,33
3)
($6,40
3)
($6,98
8)
-
($6,12
2)
-
($5,71
1)
-
($5,38
5)
-
($4,76
2)
-
($4,44
5)
-
($4,02
2)
-
($3,47
4)
-
($3,07
1)
-
($2,54
5)
-
Profit/Sale
s
0.00% 0.00% 582.33
%
289.85
%
224.50
%
186.54
%
134.41
%
114.65
%
93.06
%
70.9
1
%
57.7
0
%
43.30
%
95.00 95.00 95.00 95.00 95.00 95.00 95.00 95.00 95.00 95.00
% % % % % % % % % %

Page 26 ofCopyright  2010, GlobeNet Wireless
Broadband
Pro Forma Cash Flow
Cash
Received
Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Month
10
Month
11
Month
12
Cash from
Operations
Cash
Sales
Subtotal
Cash from
Operations
$0 $0 $1,200
$0 $0 $1,200
$2,112 $2,544 $2,887 $3,543 $3,877 $4,322 $4,899
$2,112 $2,544 $2,887 $3,543 $3,877 $4,322 $4,899
$5,323
$5,323
$5,877
$5,877
Additional
Cash
Received
Sales Tax,
VAT,
HST/GST
Received
New
0.0
0
%
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Current
Borrowing
New Other
Liabilities
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
(interest-
free)
New Long-
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
term
Liabilities
Sales of
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Other
Current
Assets
Sales of
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Long-term
Assets
New
Investment
Received
Subtotal
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Cash
Received
$0 $0 $1,200 $2,112 $2,544 $2,887 $3,543 $3,877 $4,322 $4,899 $5,323 $5,877
Expenditur
es Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Month
10
Month
11
Month
12
Expenditur
es from
Operations
Cash
Spending
Bill
$2,000 $3,800 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300 $5,300
Payments
Subtotal
$75 $2,259 $2,530 $2,807 $2,851 $2,873 $2,890 $2,923 $2,940 $2,962 $2,991 $3,012
Spent on
Operations
$2,075 $6,059 $7,830 $8,107 $8,151 $8,173 $8,190 $8,223 $8,240 $8,262 $8,291 $8,312
Additional

Page 27 ofCopyright  2010, GlobeNet Wireless
Broadband
Cash
Spent
Sales Tax,
VAT,
HST/GST
Paid Out
Principal
Repaymen
t of
Current
Borrowing
Other
Liabilities
Principal
Repaymen
t
Long-term
Liabilities
Principal
Repaymen
t
Purchase
Other
Current
Assets
$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 $0
$0 $0 $0 $0 $0 $0
$0 $0 $0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
$0
Purchase
Long-term $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Assets
Dividends $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Subtotal
Cash $2,075 $6,059 $7,830 $8,107 $8,151 $8,173 $8,190 $8,223 $8,240 $8,262 $8,291 $8,312
Spent
Net Cash ($2,07 ($6,05 ($6,63 ($5,99 ($5,60 ($5,28 ($4,64 ($4,34 ($3,91 ($3,36 ($2,96 ($2,43
Flow 5) 9) 0) 5) 7) 6) 7) 6) 8) 3) 8) 5)
Cash $53,42 $47,36 $40,73 $34,74 $29,13 $23,84 $19,20 $14,85 $10,93
Balance 5 6 7 2 5 9 1 6 8 $7,575 $4,607 $2,172
Pro Forma Balance Sheet
Month
1
Month
2
Month
3
Month
4
Month
5
Month
6
Month
7
Month
8
Month
9
Month
10
Month
11
Month
12
Assets
Startin
g
Balanc
es
Current
Assets
Cash $55,50
0
$53,4
25
$47,36
6
$40,73
7
$34,74
2
$29,13
5
$23,84
9
$19,20
1
$14,85
6
$10,93
8 $7,575 $4,607 $2,172
Other
Current
Assets
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Total
Current
Assets
$55,50
0
$53,4
25
$47,36
6
$40,73
7
$34,74
2
$29,13
5
$23,84
9
$19,20
1
$14,85
6
$10,93
8 $7,575 $4,607 $2,172
Long-
term

Page 28 ofCopyright  2010, GlobeNet Wireless
Broadband
Assets
Long-
term$5,000 $5,00 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000 $5,000
Assets
Accumul ated Depreciat ion
Total Long- term Assets
Total Assets
0
$5,000 $4,91 $4,834 $4,751 $4,668 $4,585 $4,502 $4,419 $4,336 $4,253 $4,170 $4,087 $4,004
7
$60,50 $58,3 $52,20 $45,48 $39,41 $33,72 $28,35 $23,62 $19,19 $15,19 $11,74
04208001021 5 $8,694 $6,176
Liabilities and Capital
Month Month 12Month Month Month Month Month Month Month Month Month Month
3 4 5 6 7 8 9 101112
Current Liabilities
Accounts Payable
Current Borrowin g
Other Current Liabilities
Subtotal Current Liabilities
$0 $2,17 5$2,436 $2,712 $2,756 $2,776 $2,793 $2,825 $2,841 $2,862 $2,890 $2,911 $2,938
$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$2,17 $2,436 $2,712 $2,756 $2,776 $2,793 $2,825 $2,841 $2,862 $2,890
5 $2,911 $2,938
Long-
term$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Liabilities
Total
Liabilities $0 $2,17 5$2,436 $2,712 $2,756 $2,776 $2,793 $2,825 $2,841 $2,862 $2,890 $2,911 $2,938
$0 $83 $166 $249 $332 $415 $498 $581 $664 $747 $830 $913 $996
Paid-in $70,00 $70,0 $70,00 $70,00 $70,00 $70,00 $70,00 $70,00 $70,00 $70,00 $70,00 $70,00 $70,00
Capital 0 00 0 0 0 0 0 0 0 0 0 0 0
Retained ($9,50 ($9,5 ($9,50 ($9,50 ($9,50 ($9,50 ($9,50 ($9,50 ($9,50 ($9,50 ($9,50 ($9,50 ($9,50
Earnings 0) 00) 0) 0) 0) 0) 0) 0) 0) 0) 0) 0) 0)
Earnings $0 ($4,3 ($10,7 ($17,7 ($23,8 ($29,5 ($34,9 ($39,7 ($44,1 ($48,1 ($51,6 ($54,7 ($57,2
33) 36) 24) 46) 57) 42) 04) 49) 71) 45) 16) 61)
Total $60,50 $56,1 $49,76 $42,77 $36,65 $30,94 $25,55 $20,79 $16,35 $12,32
Capital 0 67 4 6 4 3 8 6 1 9 $8,855 $5,784 $3,239
Total
Liabilities $60,50 $58,3 $52,20 $45,48 $39,41 $33,72 $28,35 $23,62 $19,19 $15,19 $11,74
and 0 42 0 8 0 0 1 0 2 1 5 $8,694 $6,176
Capital
Net $60,50 $56,1 $49,76 $42,77 $36,65 $30,94 $25,55 $20,79 $16,35 $12,32
Worth 0 67 4 6 4 3 8 6 1 9 $8,855 $5,784 $3,239