Besopps

• Retail & Consumer Services
• Leisure
• Manufacturing

Potential Returns

The investment in Golf Net Ltd.,will be the subject of an option agreement to be exercised after a period of five
years. The effect of BES relief is to reduce the effective cost of the investment by the amount of tax saved and in addition to generate a commercial return on their investment.
For example, a subscriber investing €100,000 under the terms of this issue where the individual has an equivalent amount of income taxed at 41% should, under existing tax legislation, be in the following position

Cost of Investment Shares: 10,000
Available Tax Relief:              4,100
Net cost of Investment:           5,900
Potential Return on Net Investment: 12,000 = (103.38%)

Share Rights

The holders of “A” Ordinary Shares shall receive a dividend of €0.20 per share three months after the fifth anniversary of the issue of such shares. Thereafter the holders of the “A” Ordinary Shares will have no further entitlements to dividends. No dividends shall be paid in the interim to the holders of Ordinary Shares.

Exit Mechanism

For shares to qualify for Business Expansion Scheme Relief, they must be retained by the investor for a minimum period of five years.
To enable investors to realise their investment five years and three months after the date of issue a Put and Call Option Agreement will be put in place to purchase the “A” Ordinary Shares. The price payable on the exercise of the option will be €1.15 per share.
If the Company is not in a position to purchase the shares at that time, as to do so may lead to the Company becoming insolvent, then a review of the Put and Call Option to purchase shall take place on each anniversary until such time as the Company is able to purchase the shares.
No interest or other penalties shall be imposed on the Company during the period of time the Company is unable to purchase the investor’s shares.

Winding up

On a return of assets on liquidation or otherwise the assets of the Company available for distribution among the members shall be applied as follows in the following order of priority.
(i) In repayment to the holders of the Ordinary Shares and the “B” Ordinary Shares on a pari passu basis the amount paid up or credited as paid up thereon, including any premium paid, or credited as paid thereon.
(ii) After the repayment of the holders of the shares referred to in (i) above any surplus realised shall be distributed on a pari passu basis among the holders of the Ordinary Shares and the “A” Ordinary Shares until there has been paid to the holders of the “A” Ordinary Shares a maximum aggregate of €0.15 per share.
(iii) Any surplus remaining on a winding up of the Company after the repayment of the holders of the shares referred to in (i) and (ii) above shall be payable only to the holders of the Ordinary Shares.

Voting

The holders of the “A” Ordinary Shares shall not be entitled to receive notice of, attend, or vote at any general meetings of the Company. Holders of the Ordinary Shares shall be entitled to receive notice of and vote at any general meetings of the Company and to vote on any resolution proposed thereat on the basis of one vote for each Ordinary Share.

BES Relief

Prospective investors intending to avail of relief under BES are strongly advised to consult their own independent professional advisers and should be aware that there are conditions applicable to both the Company and to individual investors which have to be satisfied if the relief is to be made available and is not to be subsequently withdrawn or reduced.
The Revenue Commissioners have expressed the opinion that provided certain conditions are satisfied, subscription for the Shares being offered In Golf Net Lt., should qualify for BES relief. No absolute assurance can be given that the BES Relief will be available or that the relief will not subsequently be withdrawn or reduced. The Directors are satisfied that, based on the opinion of the Revenue Commissioners, the Company should qualify for BES relief and it is the Directors’ intention that the Company will conduct its affairs in such a way as to remain a Qualifying Company for BES relief.

Illustrative Financial Projections

The illustrative financial projections contained in this document are based on the application of certain assumptions and are estimated regarding future events. They have been prepared by and are solely the responsibility of the Company. They do not take into account major disruptions or adverse economic conditions which may affect the activities of the Company.
Careful consideration has been given to calculating the illustrative financial projections contained in this document. However, the Company would advise that projections of future financial results are inherently subject to risk and there is no guarantee that the Company will ultimately be profitable or successful to the extent necessary to realise participants’ investment at a satisfactory level or at all.
Prospective investors should be aware that any investment made by them may go down as well as up and that they may not get the amount they invested back and that the value of the investment may fluctuate and may not be readily disposable, as it is invested in a private limited company.

Principal Assumptions

The illustrative Financial Projections and Balance Sheet have been prepared on the bases of the following assumptions:

Income

We have been conservative in our projections, in that we have based our projected income on achieving just 50% of the US sales achieved by three other golf training products - none of which have earned reviews such as ours, and each of which is considerably more expensive. Furthermore, the US market would account for approx 40% of the global market. Given the strength, and global spread, of our management team, we are well positioned to develop the entire global golf market.

Income for sales is based on wholesale price. From the outset, a considerable volume of our sales will be achieved either on-line or by Direct Response - both of which yield full retail price. For example, in Yr 3 alone, were we to compute just 20% of sales through on-line or Direct Response, then our profits would increase by €900k.

The growth of our on-line business has been projected based on linear growth. Historically, e-commerce businesses grow exponentially.

Expenditure

As with Income, we have been very conservative in our projections.Our marketing/promotion spend for Years 2 & 3 is 2.7 million, with an ROI of 8 million - which is well within industry norms. Furthermore, since on-line marketing campaigns can be measured and adapted in real-time, our marketing team would demand a much higher ROI.

Taxation

The corporation tax rate applied is based on the assumption that the current rate of 12.5% will remain unchanged. While still not implemented by statute, the Minister for Finance has stated that new enterprises in the SME sector will be exempt from corporation tax for their first three years of trading.

Risk Factors

Prospective investors should consider the following factors in evaluating the Company and its business. The company has received outline R.I.C.T. approval from the Revenue Commissioners. It is the intention of the Directors to conduct the affairs of the company in such a way as to ensure that the Company remains a qualifying company for the purposes of BES. Prospective investors intending to avail of relief under BES are strongly advised to consult their
The illustrative financial tables contained in this document are based on the application of certain assumptions and are estimated regarding future events. Careful consideration has been given to calculating the illustrative
financial projections contained in the document. However, the directors would advise that projections of future financial results are inherently subject to risk and there is no certainty that the actual results will correspond with those projected.