Mindshaker began operations in October of 1998 with a simple web site designed to welcome customers to our online store and provide basic information about Mindshaker's merchandise and the ordering and fulfillment processes. Initial programming of the web site including: basic HTML and graphics design and programming of forms processing scripts to allow the customer to submit an order was done by the current management team. The next challenges for Mindshaker will be to:

1. design, develop and maintain a fully functional dynamic web site capable of managing the transaction process from initial customer contact through order processing;
2. design and develop or purchase tutorial aids (e.g. Accounting: double entry bookkeeping tutorial, marketable securities exercise, pooling vs. purchase quiz etc.);
3. post online syllabi in conjunction with university course listings; and,
4. make multimedia learning tools available for demo and sale.

This web site will form the core of Mindshaker's business and will provide many of the cost advantages necessary to compete with traditional and Internet booksellers. Mindshaker will match other online book retailers and provide value added enhancements customized according to each school's requirements, leveraging school relationships to differentiate the service and create switching costs for users. Management expects initial technological development costs of $162,000 and ongoing monthly costs of approximately $4,500. Basic Description of the Mindshaker Ordering System

A database will store Mindshaker's product catalog and track customer and order data. Customers will be able to follow a logical progression, which begins when they select their school. Once a school has been selected, Mindshaker displays the courses available and a list of books for each class. The student can review prices, abstracts of the books, and book reviews before deciding whether to add the book to their shopping cart (See http://www.amazon.com or http://www.motleyfool.com to test this proven electronic commerce transaction model.) In addition, students may choose the option of purchasing a bundle of required texts according to the core curriculum of a given program. At checkout, the buyer is asked for a customer ID number or, in the case of a first transaction, the customer will be asked to provide billing and credit card information and a unique ID number will be issued to them. The site will note each book ordered and at checkout, display the list of books ordered and provide an order total. Once the customer enters a valid credit card and hits "send", the customer will receive a confirmation, and the order will be electronically sent to USCO for processing.

Mindshaker will hire a full-time database manager and a full-time data entry clerk to update the databases with booklists, syllabi, customer information, and other related data. The database manager will receive $50,000 in compensation and the data entry clerk will receive $20,000. (See Exhibit 2)

Security
All transactions from the moment a customer enters data about themselves will be conducted via a secure link from client browser to Mindshaker server in order to safeguard valuable customer data and credit card information. Orders will be automatically transmitted to USCO for fulfillment via encrypted email. All of the technologies upon which the new web site will be built are mature and are currently being employed by dozens of other businesses from small start-up companies to Fortune 500 companies.

Fulfillment
USCO will receive an encrypted email each time a customer makes an order. USCO employees will read it and process the order by picking the product, packing, and shipping it directly to the customer. The Mindshaker web site, in conjunction with a partnering financial institution will be responsible for processing the credit card transaction. If a bad credit card is received, the customer will be called and asked to supply another credit card. USCO currently has the technology required (PC and 128 bit encryption web browser) necessary to handle this process. They currently handle email orders for other clients as well.

Implementation and Ongoing Maintenance

1. Web and commerce site design and logo design
   Jan Muscarefla of Muscarella Designs will design all of Mindshaker's graphics, which will populate the web site. Actual programming of the HTML and scripts for the web content as well as the backend databases will be handled under the management of Alice Ward of Interpath's Professional Services Division (PSD), formerly Trinet. The PSD has extensive electronic commerce experience.
2. Software, hardware and hosting selection
   The web site will be hosted at Interpath Communications in Cary, North Carolina. Interpath maintains high speed Web servers and dedicated high speed datalinks. Interpath provides 24 hour monitoring of customer servers and performs required repairs to insure system availability. This service is provided as part of Mindshaker's hosting agreement with Interpath and means that Mindshaker will maintain no sophisticated computer equipment or data lines. All of the required systems will be housed at Interpath's facilities. Because Interpath provides services for multiple clients, they ensure that their systems are state of the art and that high-speed access is always available.

   The system will run on a Sun Unix platform at Interpath and will utilize the following proven software applications:

   • Dedicated Sun UNIX platform for web front-end processing
   • Interworld E-commerce software platform
   • Dedicated Sun UNIX platform for database processing
   • Oracle database backend
   • Standard backups and operational needs
   • Capability to support 1,000 concurrent sessions
3. System implementation, testing and ongoing system maintenance
   Interpath will implement the system and handle all ongoing maintenance as stipulated in the contract. It is anticipated that maintenance will not be more than 5 hours per month. All maintenance will require prior authorization by Mindshaker and will be paid on an hourly basis.

Scalability of Mindshaker
Mindshaker is a virtual business. The software we have chosen is scalable beyond our anticipated requirements and can be expanded to almost any level as necessary. Interpath can also provide greater server space and bandwidth (the two key elements to our customer interface and processing software) on demand for negligible additional costs.