Strategy & Implementation Summary
Financial Plan
Premium Therapy intends to raise approximately US $1,000,000 worth of seed capital. Founders and principals have already committed $100,000.
| Current Capital Structure: | ||
| Stock Type | Shares Authorized | Shares Issued |
| Common | 20,000,000 | 1,500,000 |
| Preferred | 2,000,000 | - |
| Current Shareholders: | ||
| Owner | Common Shares Granted | Percentage Ownership |
| Julius Nestor | 825,000 | 55% |
| Sherman MacDonald | 450,000 | 35% |
| Pi Long Su | 150,000 | 10% |
For $1,000,000, the investing party will receive convertible, preferred shares with an ownership interest, liquidation preference, and anti-dilution provisions as negotiated.
The proceeds from the offer will be used to fund the working capital requirements including employee compensation, research and development, initial operations facilities, and patent and trademark registration. Premium Therapy has no intention to purchase land, building, or plant, and will attempt to leverage its current assets with lease and rental whenever economical. Premium Therapy intends to issue equity options for subscription of common shares up to 20 percent of the capital as employee incentives, which will result in dilution of current shareholdings.
Liquidity for Investors and Equity Valuation:
Premium Therapy's management intends to grow Premium Therapy into the market leader with its innovative, therapeutic devices. With the attainment of each of its milestones, Premium Therapy's potential will accelerate and its enterprise value will grow accordingly. With consistently strong performance, it is likely that private investors will continue to show interests in Premium Therapy's common and preferred shares, creating market liquidity for current investors even without the benefit of an initial public offering.
To the extent that actual operational results materially exceed those projected herein, the probability of an initial public offering increases dramatically. Alternatively, the medical instrument industry has been experiencing significant consolidation for more than a decade. The company will be receptive to any appropriate merger opportunities, and investors may achieve liquidity through this vehicle.
Projected Profit and Loss
Barring any unforeseen circumstances, Premium Therapy anticipates profitability by Year 4 of operations and expects profits in subsequent years to accelerate with the increase in anticipated sales volume, yielding approximately $1.3 million in net profit in Year 4 and $8.8 million in Year 5. See Appendix D for detailed projections.
Projected Cash Flow
In Year 1 of the business plan, Premium Therapy expects to raise $1,000,000 in working capital. While Premium Therapy has planned for additional capital raising of $1,500,000 in Year 3 of the business plan, it is expected that many of the research grants for which Premium Therapy has applied, collectively totaling over $2,500,000, will have been secured by this point and that the actual required capital will be significantly less. The potential for securing grants will be greatly enhanced due to Premium Therapy's relationships with multiple renowned investigators at the nations leading universities. See Appendix E for detailed Pro forma Cash Flow projections.
Projected Balance Sheet
In order to minimize required capital in the early years of the business plan, Premium Therapy will lease and rent equipment and supplies whenever possible. This effort will be further complemented by the use of a specialty distributor, which will greatly decrease initial capital requirements. See Appendix F for a detailed Pro-forma Balance Sheet.
