Birch Bay Waterslides Investor Presentation

Birch Bay Waterslides

“Making Memorable Moments�

Email: investor@watsonfamilyllc.com Phone: 425-243-3515

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Overview Watson Family of Washington has requested funding to purchase the property and business known as Birch Bay Waterslides in Blaine, Washington. The waterpark operates on roughly an 80 day season and contains four large body slides, a six-story tall speed slide, enclosed tub slide, kiddie pool with three slides, a giant hot tub, snack, food, and beverage items, and other swimming and family fun merchandise. Some of the planned improvements include an increase in advertising efforts, enclosing some portions of the park to turn a seasonal business into a year round business, and upgrading current attractions. The unused acreage being acquired will be developed at a future date to create an even greater attraction to users. Derrick Watson is the owner and guarantor behind the financing request. He has roughly 12 years of experience in owning and operating various businesses. He intends to retain the key employees with Birch Bay Waterslides to ensure the transition of ownership is a success.

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Overview (cont.)

Sponsor Equity Invested: $102K Remmington Investment: $4.5 Million Project Cost of $5.3 Million Needed Investment: $700K* *In order for Remington to fund their portion this needed investment must be an equity partner not a loan, for this investment there will be 15% ownership in the company with quarterly disbursements.

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Team

Derrick Watson, President/Founder: Mr. Watson has found a business model for this project that will be effective and has been involved with a number of ventures in his 12 year business career. He has worked with Tiny Computers in England in numerous positions the last being regional sales director in Bellevue, WA. He starting his work there when he was only 17 years of age. He has also started numerous companies on his quest to be an entrepreneur. The main bulk of his education has came from on the job experience working from the bottom up in all of his endeavors. His main talent is marketing and sales. Mr. Watson is currently on the Policy Council for Head Start and is a new member of the Board for the community action organization, Opportunity Council.

Richard Fry, Vice-President: Mr. Fry is a specialist in fiberglass and resin workings. He has worked as a Project Lead at both, the Westport Ship Yard and Hoquiam Ship Yard. He was also the Director of West Coast Sales for Miracle Mate USA, which sold home purification systems. Mr. Fry has also had supervisory positions in sales, service, and building industries.

Mr. Fry’s last position was managing the door shop for Terro Door and Trim located in Bellingham, WA. 2/10/2011

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Team (cont.)

Iain Buchanan, Director of Operations/General Manager: Mr. Buchanan is one of the most vital members to this project. He has been the General Manager for the Birch Bay Waterslides for the past five years and is the reason that it has been profitable thus far. He graduated from Washington State University with a BA in Marketing in 2003 and has been on the Board for the Ferndale Boys and Girls Club.

Landaal Hersman, Maintenance Supervisor : Mr. Hersman has also worked at the park since he was old enough at age sixteen in multiple capacities. He has recently graduated from Bellingham Technical College with an AAS in Instrumentation and Control Technology. Mr. Hersman also learned from his father, Wayne Hersman, for the past four years serving as an assistant to him in the maintaining of park equipment.

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S.W.O.T.

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Solution

Air Dome Water Park turns into a 363 day Revenue driver Cost and Time Effective Convertible allowing park more versatility 8.50 to 10.50 per Sq. Ft. installation included Fully Customizable Inflates in less than 12 hours Deflates in less than 12 hours

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Solution (cont.)

SlideRenu saves the slides from being replaced Saves us over $200,000.00 per slide Gives life to park

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Market Size According to the Washington State Office of Financial Management, The City of Vancouver, Canada and the US Census Bureau, the anticipated drawing area for The Birch Bay Waterslides includes over 2.2 million people. *The market is projected to grow by at least 3%.

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Customers/Revenue Model

Our customers are families in the Northwest Washington and the Lower Main Land, British Columbia, Canada geographical area containing about 2.2 million potential customers Marketing in Canada will be the main marketing focus.

Water park customers average $17.95 per person in admissions with an average admissions ticket of $53.85

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Marketing Plan

T.V. Advertisement:

Total Households: 171,3000 Total monthly budget: $2,500.00 Est. Response Rate: 1%; Based off 2006 test Total Visits: 17,130 Total Rev gen from campaign: $922,450.50 Total Cost for campaign $337,483.50 NOI from campaign: $ 584,967.00 ROI for campaign: 173% 2/10/2011

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Marketing Plan (cont.)

ValPak Print Advertising:

Number of Households reached: 180,000 Total Cost per campaign month: $3,826.44 Rate of Response: 1.3% based off of previous test done in 2006 Revenue from campaign: $126,009.00 Cost of 2 for 1 promotion: $42,003.00 Total Revenue from initiative: $84,006.00 Total NOI from test: $38,176.56 ROI from marketing: 998%

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Marketing Plan (cont.)

News Paper Inserts

Cost for distribution of 30,000 inserts: $1,200.00 Response Rate: 1.57% Cost for 1 free ticket promo: $8,000.00 Gross admissions from test: $24,000.00 Total Cost of test: $9,200.00 Total margin of test: $14,800.00 ROI from initiative: 161%

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Marketing Plan (cont.)

Social Media

Market Population: 124,780 Budget for 4 weeks: $500.00 Total number of clicks: 313 *Conversion Rate: 80% Face Book Historical Conversion Average Number of Sales: 250 buy 2 get 1 free tickets Percentage of market: 0.25% Gross Revenue from campaign: $13,462.20 Cost of Promotion: $4,487.50 Total Campaign Cost: $4,987.50 Total NOI from Campaign: $8,975.00 ROI From Campaign: 1795% 2/10/2011

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Marketing Plan (cont.)

Social Media (cont.)

Other Social Media we plan to tap into...

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Competition

Six Flags (Wild Waves) and Great Wolf Lodge are both huge chains that generate a good source of revenue. The Great Wolf Lodge is unlike us since they cut off their local day-trip customer base by only allowing patrons of a night stay in their hotel to gain access into their water park. Wild Waves is a bigger version of what Birch Bay is now. With a dry side and a water park they are a true theme park. Wild Waves full day ticket rates are double the price of ours and they are only open during the summer peak season.

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Competition (cont.)

Slide Waters and Splash Down are on the other side of the Cascade Mountains in eastern Washington and the distance alone makes it hard for them to compete with us in our primary market.

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Competition (cont.)

Seasonal and cost prohibitive due to heavy taxation in Canada.

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Financials $2,500,000.00 $2,000,000.00 $1,500,000.00 $1,000,000.00

Year 2010 Year 2011-2012 Year 2012-2013 Year 2013-2014

$500,000.00 $-

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Year 2014-2015 Year 2015-2016

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ROI Year 1 •Gross Profit $1,942,333 •Operating Costs $821,753 •EBITA $1,220,580 •Debt Service Payment $360,000 •Net Cash Flow $760,580 •15% of Cash Flow $114,000 •ROI 16% 2/10/2011

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Summary You know the value of this business better than anybody

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Questions?

Derrick Watson Watson Family of Washington LLC CEO/President/Founder dwatson@watsonfamilyllc.com PH: (425) 243-3515

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