Bringing It All Together - A Financial Summary of Our Business PLan

Market Evaluation

Our market evaluation has placed FREDsense Technologies in the highly regulated field of oil and gas water quality monitoring due to the high potential impact our technology could play in this market. We have assessed that the general toxin sensing market represents a $50 Million opportunity based on data collected evaluating the Alberta oil and gas market in addition to international water quality management markets. This is specific to the Alberta oil and gas monitoring and does not include other potential market avenues including waster water monitoring, sampling for individual private companies, or agriculture monitoring streams all of which are potential market opprotunities for our diverse platform technology.

Cost To Develop Our Product

From our manufacturing analysis which was done in collaboration with ACAMP, we were able to determine the potential cost of bringing our prototype into an actual determined product. From this analysis we have been able to predict that a single catridge for the detection of toxins in a water sample could cost approximately $7.95 and a detection system which could be used in conjunction with multiple numbers of cartridges could cost approximately $150.00. The sales price of our cartridges and detector systems were set at $150 and $1,500 to be competitive and more cost effective than other products presently used in this market. Being almost 20x and 10x below our sale price, respectively, these number appear reasonable to obtain profitability and were used in determining our profitability in the market (see below).

Company Profitability In Our Market

By 2015, there will be well over 500 sampling sites mandated to be monitored for their water quality in the province of Alberta. Each one of these monitoring sites are required to take a variable number of samples at different locations around the sites as well as a variable number of periods throughout the year. By estimating the potential number of sites that could use our technology, our group estimates that the total market potential of our general toxin sensor is $8.75 Million annually. If our technology could displace 30% of this market, their is the potential of producing a $2.6 Million annual profit for our general toxin sensor alone.

Net Profitability and Financial Barriers To Market