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EcoClear Inc.
Executive Summary

EcoClear Inc. has been established to globalize an innovative self-cleaning water filtration technology, which is applicable to a wide range of markets. Our launch product is a self-cleaning filter for domestic swimming pools. Sales of this product in Australia already exceed 3000 units, ordered by pool builders in the past month. This plan concerns the introduction of that product into the US market and seeks funding for working capital and continued R&D activity.

The strategic competitive advantages of EcoClear Inc. are its performance and cost advantages. The EcoClear filter saves substantial maintenance time, water, pool chemicals and electricity, while consistently filtering to a higher level of water clarity. EcoClear's simple design, smaller size and low-pressure operation also allows a substantial cost advantage in production. These performance and cost advantages are sustainable in the short to medium term as a result of the web of intellectual property protection built around the technology. The sustainable competitive advantages will be increased over the medium to longer term by reputation building and the fruits of our R&D program.

EcoClear Inc.'s management team of Andrew Maxwell, Kim Goriss and Prue Kellahan represent a strong blend of complementary skills and business experience. In addition to their MBAs, Andrew and Prue have (or soon will have) completed their Masters of Accounting degrees. Prue also has a Bachelor of Laws to her credit, and is presently completing the requirements necessary to be admitted to the Bar. Andrew, the CEO, launched his first business at age 17 and has since started a long list of successful entrepreneurial ventures in Australia and internationally. Kim, the CFO, has substantial start up and corporate business experience internationally. Prue, Legal Liaison, has many years experience within her family business. All three have worked together successfully as a team throughout their MBA program.

Our strategic plan is to seek a license agreement with a major pool filter manufacturer and to achieve penetration of the North American market via that licensee's distribution system. Royalty income from this arrangement will allow EcoClear Inc. to fund ongoing R&D for the diffusion of the technology into other pool markets and other industry applications, e.g. irrigation, aquaculture, brewing and air conditioning. In these subsequent markets, EcoClear Inc. will decide to issue licenses or enter as a manufacturer, as reason dictates.

Royalty income is expected to begin in 1997, growing to $5.3 million in 2001, based on conservative assumptions regarding market penetration and industry growth assumptions. Net Profit after tax is projected to grow to $2.38 million in 2001. Although R&D expenses for the development of extensions into other filtration markets are included in the cash flow analysis, no revenues are included from these other markets - they are part of the 'blue sky' potential.

The NPV of the enterprise is $4.5 million after discounting the cashflows at 40%. The Internal Rate of Return (IRR) is 112%. The value of the company (assuming P/E = 10) is projected to be $23.8 million in 2001.

EcoClear Inc. is seeking a new equity partner with $300,000 and commercial knowledge of the North American swimming pool industry. This capital is required to fund the initial period of negative cashflow while the management of EcoClear Inc. seeks all necessary approvals for the North American market; negotiates an agreement with a manufacturer; and continues to develop the technology.

EcoClear Inc. offers the investor a 33% equity share in the business. The investor can expect to receive payback (from dividend income alone) in 3.1 years and would hold an equity value of nearly $8 million in 2001. The projected NPV to the investor of the dividend stream and the exit value of the equity (discounted at 40%) is $1.4 million and the IRR is 101%.

EcoClear Inc. is an exciting and potentially very rewarding investment opportunity, and the management team looks forward to discussions with you, after you have read this Business Plan.

EcoClear, Inc.
Table of ContentsAppendices
1. Executive Summary
2. The Company
3. Marketing Plan
4. Operational Plan
5. Financial Plan
Proforma Financial Statements
Sources and Uses of Funds
Sensitivity Analysis
Break Even Analysis
Worse Case Scenario
Product Diagrams
Direct Production Costs
All information herein is confidential and belongs to EcoClear,Inc.