Software, Inc.

Summary Financial Projections

2002 2003 2004 2005 2006 2007

INCOME STATEMENTS
for the years ending December 31
($000 omitted)

Revenues
Product 4,400 7,000 10,400 16,200 25,000
Services 1,100 2,145 3,600 8,800 15,000
5,500 9,145 14,000 25,000 40,000
Cost of revenues 1,200 1,634 2,240 3,500 4,800
Gross margin 4,300 7,511 11,760 21,500 35,200
Operating expenses
Sales and marketing 2,340 4,476 6,720 11,750 18,400
Research and development 1,081 1,742 2,520 4,250 6,400
Finance and administration 639 1,004 1,540 2,500 3,200
4,060 7,222 10,780 18,500 28,000
Operating income (loss) 240 289 980 3,000 7,200
Non operating income (expense) -26 11 74 90 135
Income (loss) before income taxes 214 300 1,054 3,090 7,335
Income tax expense -1 -1 -1 -1,250 -2,934
Net income 213 299 1,053 1,840 4,401

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 Software, Inc.
Summary Financial Projections

2002 2003 2004 2005 2006 2007

CASH FLOW STATEMENTS

for the years ending December 31
($000 omitted)

Cash provided by (used in ) operating activities

Collections from customers 4,921 9,015 13,460 23,776 38,330
Payments -5,036 -8,693 12,462 22,109 34,233
-115 322 997 1,667 4,097

Cash used in investing activities -145 -265 -465 -665 -865

Cash provided by (used in) financing activities

Bank 0 0 0 0 0
Capital lease proceeds 107 135 100 200 240
Capital lease payments -53 -82 -117 -75 -116
Investors 0 2,950 0 0 0
54 3,003 -17 125 124

Total cash flow -206 3,060 515 1,127 3,356

Ending cash balance 384 3,444 3,959 5,086 8,443

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 Software, Inc.
Summary Financial Projections

2002 2003 2004 2005 2006 2007

BALANCE SHEETS
as of December 31
($000 omitted)

Current assets
Cash 590 384 3,444 3,959 5,086 8,443
Accounts receivable 302 1,440 2,308 3,533 6,309 10,095
892 1,824 5,752 7,493 11,396 18,538
Fixed assets 116 197 302 666 1,109 1,604
Other assets 67 109 129 129 129 129
1,075 2,130 6,183 8,288 12,634 20,271

Capital leases -- current portion 33 66 117 75 116 157

Accounts payable and accrued expenses 165 515 817 1,201 2,030 3,026
Deferred revenues 404 840 1,290 1,975 3,527 5,642
602 1,421 2,224 3,251 5,672 8,826
Long term debt -- capital leases 101 124 125 150 234 317
703 1,545 2,349 3,401 5,906 9,143
Equity (Deficit)
Common stock and paid in surpl 2,147 2,147 5,097 5,097 5,097 5,097
Accumulated losses -1,775 -1,562 -1,263 -210 1,630 6,032
372 585 3,834 4,887 6,727 11,129
1,075 2,130 6,183 8,288 12,634 20,271

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 Software, Inc.
Summary Financial Projections

2002 2003 2004 2005 2006 2007

STAFFING
at December 31

Sales and marketing 9 15 26 36 58 75

Customer services 7 15 18 27 40 65
Research and development 8 12 17 22 32 50
General and administrative 4 6 9 15 20 30
28 48 70 100 150 220

STATISTICS

Operations Revenues per employee ($000) 115 131 140 167 182
Expenses per employee ($000) 110 127 130 147 149
Cost of revenues as a % of revenues 22% 18% 16% 14% 12%
Financing Financing from new investors (net) ($000 0 2,950 0 0 0
Balance sheDSO 50 60 60 60 60
Working capital ($000) 403 3,528 4,242 5,723 9,712

% OF REVENUE ANALYSIS
for the years ending December 31

Revenues
Product 80% 77% 74% 65% 63%
Services 20% 23% 26% 35% 38%
100% 100% 100% 100% 100%
Cost of revenues 22% 18% 16% 14% 12%
Gross margin 78% 82% 84% 86% 88%
Operating expenses
Sales and marketing 43% 49% 48% 47% 46%
Research and development 20% 19% 18% 17% 16%
Finance and administration 12% 11% 11% 10% 8%

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 Software, Inc.
Summary Financial Projections

2002 2003 2004 2005 2006 2007

74% 79% 77% 74% 70%
Operating income (loss) 4% 3% 7% 12% 18%

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