CONFIDENTIAL

CORPORATE OVERVIEW

Prepared: September 2003

By Michael D. Allweiss Chairman/CEOOffshoreRacingLeague100 2d Ave. N.E. Ste. 704S727-821-APBA (2722)

Mallweiss@aol.com

__________________________________

This document and its contents are confidential and the property of KHAMAN HOLDINGS, INC.. No reproduction of all or any part of this plan or any redistribution thereof is permissible without the prior written consent of KHAMAN HOLDINGS, INC.

This business plan is intended to convey information only, and shall not constitute or be construed as an offer to sell or the solicitation of an offer to buy securities.

Table of Contents

Table of Contents.............................................................................................................................2

Executive Summary..........................................................................................................................................4

HISTORY.....................................................................................................................................................................4THE BUSINESS............................................................................................................................................................6APBA OFFSHORE RACING LEAGUE...........................................................................................................................7THE NEW COMPANY.................................................................................................................................................12THE OPPORTUNITY...................................................................................................................................................13

The Offshore Racing League (ORL)..............................................................................................................16

THE PRODUCT...........................................................................................................................................................16THE SPEC RACING PROGRAM...................................................................................................................................18

Super Cat (Numbers Only) -.................................................................................................................21Super Cat Light (Numbers Only) -.......................................................................................................24Super V (Numbers Only) -.....................................................................................................................25Super V Light (Numbers Only) -...........................................................................................................26Factory I and II -...................................................................................................................................27Outlaw...................................................................................................................................................29

STADIUM STYLE RACING -.......................................................................................................................................31The Offshore Powerboat Racing Circuits.............................................................................................33

Overview –.....................................................................................................................................33The ORL National Circuit – GMC Pro Grade Championship Series............................................35

The Season –.................................................................................................................35Site Selection Criteria –................................................................................................36Venues –........................................................................................................................37National Race Format –...............................................................................................38Pro Series Championships............................................................................................40

The ORL Divisional Circuits –......................................................................................................41Overview........................................................................................................................41Purpose..........................................................................................................................41The Divisional Circuits and Management...................................................................42Divisional Circuit Sponsor Opportunities....................................................................43

ORL MANAGEMENT.................................................................................................................................................44ORL DIVISIONS AND AFFILIATES.............................................................................................................................49OBJECTIVES – IN GENERAL......................................................................................................................................52ECONOMICS OF ORL................................................................................................................................................54

Overview...............................................................................................................................................54Revenues...............................................................................................................................................58

Series Sponsorships.......................................................................................................................58Competitor Contingency Sponsorships.........................................................................................59National Television Advertising....................................................................................................60Sanction Fees.................................................................................................................................60Entry Fees......................................................................................................................................61Boat Registration Fees...................................................................................................................61Membership Fees...........................................................................................................................61Licensing........................................................................................................................................63

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Apparel..........................................................................................................................63Merchandise..................................................................................................................63Racing Related Products and Services.........................................................................64

Expenses................................................................................................................................................64Event Related Expenses.................................................................................................................65

National Staff................................................................................................................66Prize Money and Insurance.........................................................................................66Television Production...................................................................................................67

General Overhead..........................................................................................................................70Administrative...............................................................................................................................70

PROMOTION AND PUBLIC RELATIONS......................................................................................................................72INTERNET..................................................................................................................................................................73THE MARKET............................................................................................................................................................74THE COMPETITION....................................................................................................................................................76

NEWCO.........................................................................................................................................................77

5.8 COMPANY VISION AND GOALS.................................................................................................................795.9 MARKET ANALYSIS...................................................................................................................................80

5.10.5...........................................................................................................Membership Marketing.......................................................................................................................................................80

7.2.3 THE FAMILY ORIENTED ENTERTAINMENT FESTIVALS....................................................................................81

Injecting Professionalism into the Sport.........................................................................................................89

Strong Business Model...................................................................................................................................95

5.10 MARKETING PLAN.....................................................................................................................................975.10.1 Overview...........................................................................................................................98

5.10.3 TELEVISION MARKETING......................................................................................................................985.10.4 Local Television, Radio, and Print Marketing/Advertising...........................99

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Executive Summary

History

The American Powerboat Association (“APBA”) is a New York not-for-

profit corporation founded in 1903 that, among other things, had historically acted

as the primary organizational and sanctioning body for offshore powerboat racing

and related special events throughout the United States and North America. APBA

also is the national governing authority in the United States for the Union

Internationale de Motonautique (“UIM”), which is the worldwide governing body

for all forms of powerboat racing. Historically, APBA had conducted its offshore

racing operations through an unincorporated division known as the Offshore

Category (the “Category”). The functions of the Category included oversight and

management of racing competition, including technical rule making, event rules

enforcement, and event production and television production of those events at

both the national and divisional/divisional levels. APBA transferred all of these

functions in April 2000 through an exclusive license agreement, to APBA Offshore

Powerboat Racing, LLC (“LLC”) a Florida for-profit limited liability company,

which had been formed by a group of then Category members (the “LLC

Founders”).

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In March of 2003, a dispute arose between the LLC and APBA over fee

payments and corporate governance issues, which led certain APBA officials to

purportedly terminate the license. The LLC initiated litigation against these

officials in Florida shortly thereafter claiming that they acted without legal

authority thus damaging the LLC. The APBA officials then filed an action in New

York seeking a declaration from the state supreme court that they had that

authority. In July of 2003 the New York court ruled against these officials. As a

consequence all parties, including the LLC and the LLC Founders, recently

reached a global settlement of all outstanding issues. The settlement produced a

new license (the “License”) between the LLC Founders and their newly formed

Florida corporation, KHAMAN Holdings, Inc. (hereinafter “KHAMAN”) and the

APBA. The License becomes effective November 1, 2003.

The License grants KHAMAN full right, power and authority to exercise all

aspects of the sport of offshore power boat racing (and related activities and special

events) under the APBA name and sanctioning authority and, correspondingly,

provides that APBA will not, itself or through any other party or in any manner,

conduct any such activities. Under the new License KHAMAN assumes all

responsibility and authority relating to, and conducting the foregoing business

activities of the former Category and other business activities relating to the sport

including but not being limited to membership marketing and sales, licensing and

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merchandising, poker run event sanctioning and production, endurance run

sanctioning and production, speed record run sanctioning and production, marine

manufacturer show production, television production and promotion of such

events, product development and sales, and sponsorship sales. The new license

also permits KHAMAN to opt out of the arrangement within five years or sooner if

management believes that there is no longer any value in the APBA relationship.

The Business

Over the past 5 years, APBA Offshore management has revolutionized the

sport by: 1) developing and executing a NASCAR (National Association of Stock

Car Automobile Racing) style rules model which emphasizes close, exciting

competition for fans, sponsors and competitors, and 2) creating a new stadium

style racing format which brings the action close to fixed shore locations such as

downtown waterfronts and parks, where admission can be charged, VIP and

corporate entertainment and hospitality venues can be established, marketed and

sold, and where concessions, merchandise, apparel, product expositions and vendor

booths can be marketed and sold as well.

The result is a fabulously exciting motorsports entertainment business

capable of generating huge event crowds and significant television audiences with

a very broad demographic that appeals to a wide variety of potential sponsors and

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business partners. For the first time in the history of the sport, offshore power boat

racing has become a legitimate, credible motorsport that thrills audiences both at

the race site and on television with speed, high flying and colorful racing craft,

passing, come from behind victories and photo finishes. To capitalize on the

opportunity presented by the successful development of the racing product and the

new License, KHAMAN shall create two separate and distinct but related

businesses, one to operate the sanctioning body business and the other to operate

the event promotion business.

The first business is the Offshore Racing League, Inc. (“ORL”) a newly

formed Florida corporation ___% owned by KHAMAN that shall operate and

manage the sanctioning body business. In other words, the ORL will be to offshore

boat racing what NASCAR is to stock car racing. The second business, a yet to be

formed Florida corporation, shall be a private motorsports entertainment and

promotional company that serves as the exclusive promoter/producer of all ORL

events (“Newco”).

APBA Offshore Racing League

The ORL will be the organization that performs the traditional functions of

the sanctioning body, to wit: technical and competition rules making and

enforcement; competition and competitor management; national series sponsorship

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sales and marketing; national contingency sponsorship sales; prize purse

development and payout, national and divisional points tracking and

championships, membership sales, marketing and fulfillment, licensing of team

and ORL merchandise and apparel; securing national television networks for

distribution of the TV product; production of national series television; racing and

non-racing membership programs; National Medical, Safety and Rescue programs;

Marine mammal protection programs; event production and management of race

related activities such as medical, safety and rescue, race course management, dry,

wet, and hot pit management, etc. In short, ORL shall be responsible for the

development and management of the actual boat racing product and related aspects

of the business.

The principal revenue centers of the ORL are as follows:

1. Series Sponsorships

2. Competitor Contingency Sponsorships

3. National Television Advertising

4. Sanction Fees

5. Entry Fees

6. Boat Registration Fees

7. Membership Fees

8. Licensing

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a. Apparel

b. Merchandise

c. Racing Related Products and Services

The principal expense areas of the ORL are as follows:

1. Administrative

2. Payroll

3. Marketing

4. Advertising

5. Event Related Travel

6. Television Production

7. Television Time Buys

8. Equipment

9. Legal

10. Insurance

11. Prize and Contingency Purses

APBA ORL is uniquely positioned for rapid growth and to become the next

successful motorsports entertainment property in large part due to the following:

1. ORL has an exclusive 5year license agreement with the APBA thus

creating a very strong barrier to entry to a start-up organization;

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2. The ORL has secured General Motors and GMC as the Title Sponsor of

its national racing circuit for the 2004-2005 seasons. This flagship

sponsorship parallels NASCAR landing its first major sponsor, Winston,

in 1971;

3. ORL faces virtually no competition in its niche market – high

performance professional powerboat racing events and entertainment;

4. ORL racing offers a unique, exciting, and rich television product that

combines extreme competition, beautiful destinations and an upscale

lifestyle in fast paced 60minute programs;

5. ORL boasts a very experienced and diverse management/operations team

that over the past several years has created an effective and profitable

sanctioning body with an incredibly fresh and exciting motorsports

entertainment product;

6. The new license also will yield as much as $200,000.00 - $300,000.00 in

additional revenue to the core sanctioning body business, thus enabling it

to commence operations immediately without a significant infusion of

new capital.

Offshore powerboat racing, moreover, is the last frontier of motorsports both in

terms of entertainment value and as a business opportunity. The U.S. is saturated

with various forms of automobile racing many of which have become

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indistinguishable to the general consumer and thus of questionable value to new

sponsors. NASCAR, which is the dominant force in U.S. automobile racing today,

moreover, has become too expensive for many companies to participate in any

meaningful way.

Further, traditional powerboat racing in general has not had any commercial

success due mainly to the amateur nature of the governing associations such as

APBA, and most event organizers. The demand for entertaining outdoor events

remains high, however, among consumers as well as companies that recognize

event marketing as an effective sales and marketing tool. ORL racing, with the

speed, excitement, pageantry, professionalism and affordability it offers, thus

presents a unique motorsports entertainment opportunity for consumers and a

related event marketing opportunity for these companies.

All of the above factors, efforts and resulting successes have created an

opportunity for a new and separate company dedicated to the potentially far more

profitable event promotion and related ancillary entertainment aspects of the

business (concerts, event sponsorships and media, event planning, and production,

festivals, etc.). Through the successful development of a new company dedicated

to the sale, marketing, promotion and production of Offshore’s events, the sport

and thus the overall business will grow faster and become far more profitable over

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the next 5-10 years. This new company is the second business to which the

following discussion is addressed.

The New Company

Newco will be similar in concept to International Speedway Corporation

http://www.iscmotorsports.com/ (“ISC”), which is the publicly held entity dedicated to

the acquisition and development of the speedways which host NASCAR events.1

The function of Newco shall be to develop and implement the following businesses

related to ORL and its core sanctioning body business: 1) Owner, operator,

promoter, producer of all of ORL’s race venues; 2) Develop new venues in major

markets; 3) Develop a national radio/internet broadcast network similar to MRN

which is owned and operated by ISC; 4) Develop event related catering services,

food and beverage concessions, and merchandise sales businesses for its event

venues; 5) Develop ORL’s interactive rights business such as its official website

and those related to its events; 6) Develop a national sponsorship sales, marketing

and promotions company which can generate event related sponsorship sales as

well as national sponsorship sales for ORL – for which it would receive

commissions – and fulfill those sponsorships with limited outside assistance.

1 List the other businesses of ISC

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KHAMAN or its designee shall seek to raise approximately $1,000,000.00 -

$1,500,000.00 from outside investors for Newco in order to begin the development

and implementation of the foregoing six businesses. KHAMAN shall seek funding

primarily from three sources: 1) Current race team owners and participants; 2)

Performance boating enthusiasts who currently participate in poker runs, attend

ORL events and serve as volunteers for these events; and 3) individuals and

entities that are located in currently successful ORL event venues. The goal is to

create this entity and hire the appropriate staff and management to commence

operations no later than January 1, 2004.

The Opportunity

The demand for such events and the corresponding opportunities for both

consumers and corporate America are what create the business opportunity for

Newco, and thus the investment opportunity for potential shareholders. Here is

how: First, from an event production standpoint, ORL events do not require

massive infrastructure like a speedway, road course or a downtown street race

where expenditures for construction, maintenance, repairs and facilities

management can reach well into the multi-millions of dollars. On the contrary, to

create an ORL “racetrack” Newco needs only a large body of water like a lake,

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ocean, bay or river, within close proximity to a fixed viewing location such as a

beach or public park, and 6-10 “turnbouys”, which cost approximately $100 each.

Second, the actual costs to produce the event are low relative to other

motorsport events. For example, most of the physical labor necessary to execute

the on-land and on-water event plan can be satisfied through volunteers. So labor

costs are minimal. Indeed, most of the related labor costs for the events arise from

sales and marketing personnel whose job it is to generate revenue. The facilities

required for the event are minimal as well since the viewing venues, whether a

beach or park, already exist. While there may be some costs such as leasing a park,

securing grandstands, and city services such as police, fire, medical personnel,

security, port-o-lets and waste management, these expenses rarely exceed 5 figures

for an entire event weekend. The bottomline is that a high quality turnkey ORL

event can be produced for roughly $250,000.00 including sanction fees.2

These events on the other hand can be extremely profitable for Newco. For

example, a properly marketed and advertised event can generate on-site crowds of

10,000 – 20,000 or more. Ticket sales alone thus could cover 50% or more of the

event production costs. Apparel and merchandise sales are yet another source of

potentially $50,000 - $75,000 in revenue per event. An ORL event also offers a

unique corporate hospitality and entertainment opportunity capable of generating

another $50,000 - $100,000 in VIP sales at each event. Then of course, there are 2 financials for event company

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local and divisional sponsorship opportunities which should generate another

$250,000 - $500,000 in event revenue. Thus, the events each should generate

$100,000 - $250,000 in net profit. With a minimum of ten national events per year

Newco should be able ultimately to generate $1,000,000 - $2,500,000 in net profits

from its core event production business alone.

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The Offshore Racing League (ORL)

Newco will produce a significant return on investment for its shareholders

because the ORL, free to concentrate exclusively on its racing product, shall

achieve its primary strategic goal and objective: to become a nationally recognized,

highly respected, top tier professional sports entertainment property. In short, the

ORL will create an exciting motorsports entertainment product that the public

demands and that city, county, state and national leaders compete to secure for

their communities. Newco then will market and sell the ORL events and the related

apparel and merchandise, licensing, concessions, tickets, local, divisional and

national sponsorships, and ORL interactive rights.

The Product

Traditional offshore racing events were participant oriented endurance runs

covering vast distances mostly on ocean courses well out of sight of land and

obviously, spectators, and thus of limited commercial value to any sponsor. The

racing was boring. There was very little passing, few winners over the course of a

season; a high rate of attrition and few close finishes. The rules were controlled by

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the team owners and thus were convoluted and poorly enforced. This led to

checkbook racing where the teams with the most money won. Often there were

more classes than there were boats so participants could almost guarantee

themselves a checkered flag, which further eroded the credibility of the racing

product. This also led to a very high rate of turnover in participants and thus an

inconsistency in the “product” that made it nearly impossible to develop a

dedicated fan base. Certainly fans had no idea what was happening on the water as

organizers often placed 50 or more boats from 20 or so different classes in a race at

the same time. In short, there was no racing product and therefore, no event

product for anyone but the participants.

Today, ORL has moved in shore and become a consumer based, spectator

friendly motorsport that places a premium on competition as entertainment and

connecting the consumer with the corporate sponsor. While racers remain one of

the core groups of customers, the racing, race boats and the race teams form the

foundation of the ORL product. This fundamental shift in philosophy was

necessary to transform the sport from a participant based club/hobby not-for-profit

business to a for-profit consumer based professional motorsport entertainment

business capable of attracting significant outside investment. The primary

ingredients to future successful growth of the ORL product are: 1) The Spec

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Racing Program for the boats, engines and propulsion systems, and 2) the Stadium

Style Racing format for the events.

The Spec Racing Program

The first key component to the continued growth and development of the

ORL product is a stable fleet of race boats and teams that remains so regardless of

the state of the economy, and close, exciting competition for spectators and

television viewers. In short, the racing related entertainment, excitement and fun

generate fan interest, which in turn generates sponsor interest. ORL management

thus places a premium on creating a close competitive racing “show” for the event

and for television. After years of research and analysis ORL management

determined that to create such a show it must develop, implement and strictly

enforce a very tight, yet stable technical and competition rules program (“Spec

Racing Program”) that produces a fast, agile, yet tough racing fleet with reliable

propulsion systems across all 6 of its featured racing classes. The boats also must

be audio-visually stimulating to the average fan/spectator/viewer.

As opposed to the technology based rules model that dominated offshore

racing for so many years, the goals and objectives of the ORL Spec Racing

Program are as follows:

Relatively low cost, affordable, “level playing field” racing for competitors

and participating marine industry manufacturers;

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Participation of the marine industry from a competition and financial

perspective;

Closer more exciting competitive racing through correspondingly tight yet

stable competition based technical rules management and enforcement;

Multiple winners throughout the season;

Close finishes;

Close, dramatic national championship battles designed to be settled at the

last event of the year;

The racers are the “stars”;

Winners and champions decided by skill, courage and preparation NOT by

who has the biggest checkbook;

The Spec Racing Program thus has four essential components: 1) tight length,

weight, height, beam and manufacturer production based rules and restrictions for

the boats; 2) engines produced by one to two CRE approved suppliers that also

must be sealed, certified and matched by CRE prior to competition; 3) approved

sterndrive systems produced by one to two CRE approved suppliers, with limited

permitted modifications; and 4) Strict requirements on commercial availability as

well as limitations on development of propellers. Accordingly, ORL has entered

into a management agreement with an independent Florida company, Certified

Racing Equipment, Inc. (“CRE”) to develop and manage the rules and the

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technical inspection process, and conduct the research and development programs

that are integral to the Spec Racing Program.

Over time, the Spec Racing Program has produced and will continue to produce

more competitors, less participant turnover, better professional competition and

thus an exciting, entertaining experience for consumers. The stability and

consistency of the Spec Racing Program also produces a stable cost environment

for the racing teams relative to their equipment purchase, repair and maintenance

programs, and thus will yield a far better return on investment once their

sponsorship and prize revenues increase. Similarly, the costs of the ORL technical

and competition rules development and enforcement program will remain

relatively constant as well thus producing increasing margins as revenues grow.

Indeed, despite the economic downturn since 2001, the Spec Racing Program

has produced 70-80 boat racing fleets at national events whereas in the past such

downturns generally led to severe reductions and fleets in the 30-40 boat range.

Management thus believes that the Spec Racing Program will produce fleets of 100

boats or more per event simply with a turnaround in the economy.3 More

importantly, the Spec Racing Program combined with the consolidation of classes

from 12 in 1999 to 6 today, means more boats in the premier classes. This, in turn

will lead not only to better more exciting racing, but more events and thus more

opportunities for Newco as the classes can be separated and run at different venues 3 100 boats average in 2000 with the introduction of the spec racing program

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and times. More boats, more competitors and more events also leads to more

revenue and with the stable costs associated with the Spec Racing Program, more

profits for ORL and the race teams.

Super Cat (Numbers Only) -

Super Cat is the premier ORL class. In 2004, ORL will continue with its

single approved sterndrive, the Mercury Racing SSM #6, which has proven to be a

tough, resilient, safe and cost effective system for the teams especially with the

long duty cycle and limited repair and maintenance required, and its fixed hull

rules. ORL will, however, commence the transition from a multi-approved builder

varying spec engine program to a single approved builder fixed spec engine

program. This same basic system (GM and Mercury Racing supplied engines,

Mercury and Imco supplied drives) has been utilized by Offshore for years in the

Factory, Super V, Super V Light and Super Cat Light classes with great success.

The sole ORL/CRE approved engine provider, Sterling Performance, is the

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20 Boats Nationally20 Boats Nationally

38’ to 40' 38’ to 40' CatamaranCatamaran

9500lbs 9500lbs

1600 Total 1600 Total HorsepowerHorsepower

140mph Top Speed140mph Top Speed

unquestioned leader in marine propulsion systems over 600 horsepower and has

actually designed and built the engines for every national champion and the last 3

world champion Super Cats. In addition, the contract requires Sterling to pay ORL

a $150,000.00 guaranteed sponsorship fee plus royalties, which helps pay for

television and other costs associated with the class.

The goals of the spec engine program are to: 1) increase competitive balance

throughout the fleet; 2) develop a “5 race engine”; 3) reduce maintenance and

operating costs for the majority of the teams during an entire season; 4) increase

reliability and durability; 5) increase performance and acceleration so the Super

Cats can negotiate the tighter multi-turn ORL courses more effectively and safely;

and 6) increase the number of teams that can afford to field competitive Super Cat

entries.

To accomplish these goals, the ORL has developed a transition plan that

minimizes the financial impact on the teams and should at the very least maintain

the size of the current Super Cat fleet. First, Sterling will retrofit every currently

existing engine regardless of the builder, to a specific specification. The retrofit

cost shall not exceed $15,000/engine, which is the approximate cost of a normal

rebuild today. Second, each engine will be matched on a dyno then sealed and

certified to ensure each competitor has the same amount of horsepower and torque,

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but cannot perform their own upgrades to gain an advantage over their

competition.

Third a newly designed engine shall also be made available at an initial cost

of approximately $45,000.00ea. which is low relative to other motorsports and

certainly to the old-style huge horsepower engines formerly used in APBA. Fourth,

the new and retrofitted engines will be designed to operate with minimal

maintenance over 5 races, which will lead to drastically lower operating costs for

the teams. Indeed, teams will be required to use the same engines a minimum of

two to three times before changing and the maintenance and rebuild fees will be

fixed for everyone.

Fifth, while the engines ultimately will be assigned to the teams at random to

ensure the integrity of the program, during the interim period when there are

retrofitted engines in the mix, a commercially reasonable engine-claiming rule will

be established. With a stable, relatively low cost engine program that guarantees

each competitor matched engines the national Super Cat fleet should grow to a

consistent 10-15 competitive boats at each event. This should also increase

competitive balance throughout the fleet, thus furthering the goals of the program.

Finally with more boats ORL receives more revenue from entry fees, registration

fees, and royalties from the Sterling contract, and Newco receives more quality

opportunities with an improved and consistent show to promote at each event.

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Super Cat Light (Numbers Only) -

The Boats: Slightly smaller versions of the Super Cats, these boats are 8000lb

twin engine racing catamarans (canopies only) ranging from 35’-38’. Top Speeds

are approximately 120mph. Manufacturers include Marine Technologies, Skater,

Eliminator, Motion and Specter.

The Engines and Drives: The engines are stock Mercury Racing 502cid HP500

EFI’s, and new for the 2003 season include the Mercury Racing HP525 EFI and

the GM Vortec HP3 8100. All engines are dyno tested, sealed and certified to be

within a certain specification by Offshore through CRE, to ensure competitive

balance. CRE is negotiating with Mercury to transfer the inspection, tech, repair,

sealing and certification, and rebuild programs to them for Mercury engines and to

Innovation Marine for the GM engines. The Mercury Bravo One, Sportmaster, XZ,

XR, and Imco, and Mercury #6SSM drives may be used.

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Super V (Numbers Only) -

The Boats: Super V’s are the biggest and fastest of Offshore’s V-Bottom classes.

Super V’s are 8000lb twin engine racing v-bottoms (canopies only) ranging from

38’- 40’. Top Speeds are approximately 110mph. Manufacturers include Fountain,

Extreme, Cigarette, Donzi, Outer Limits, Skater and Wellcraft.

The Engines and Drives: The primary engine is the GM Vortec HP3 – 8100

496cid. Mercury Racing HP525 EFI engines currently existing in registered boats

are also approved for competition, however, beginning in 2004, no new engines

other than the Vortec shall be permitted. The engines are CRE dyno tested, sealed

and certified for competition. Innovation Marine is the sub-contractor to CRE that

performs these services. CRE personnel, however, oversee the program and

conduct random spot checks through the season to ensure compliance with the

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15 Boats Nationally15 Boats Nationally

Up to 40' V-Bottom Up to 40' V-Bottom

1100 Total 1100 Total HorsepowerHorsepower

110mph Top Speed110mph Top Speed

rules. The Mercury Bravo XR, XZ and Sportmaster drives are approved as are the

standard and 4x4 Imco drives. The Mercury Racing SSM #6 drive is also approved

with a weight penalty.

Super V Light (Numbers Only) -

The Boats: Slightly smaller versions of the Super V’s, these boats are 5000lb

single engine racing v-bottoms (canopies only) ranging from 28’-32’. Top Speeds

are approximately 95mph. Manufacturers include Extreme, Phantom, Activator,

Warlock and Eliminator.

The Engines and Drives: Same as Super V.

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10 Boats Nationally10 Boats Nationally

Up to 40' V-Bottom Up to 40' V-Bottom

550 Total 550 Total HorsepowerHorsepower

90mph Top Speed90mph Top Speed

Factory I and II -

Factory 2 (designated by F2)

The Boats: These boats are stock 35' to 39' twin-engine production based v-

bottoms with a fixed weight of 8300lbs. These boats appear virtually identical to

the pleasure performance v-bottoms that can be purchased from a local new boat

dealer. Minimum production number and dealer network requirements ensure that

the boats are not dedicated race boats produced by non-mainstream builders. Top

speeds are approximately 85 mph. Manufacturers include Donzi, Baja, Fountain,

Cigarette, Formula, Hustler, Warlock and Eliminator.

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35 Boats Nationally35 Boats Nationally

Up to 30’ V-BottomUp to 30’ V-Bottom

500 Total Horsepower500 Total Horsepower

80mph Top Speed80mph Top Speed

35 Boats Nationally35 Boats Nationally

Up to 39’ V-BottomUp to 39’ V-Bottom

1000 Total1000 Total HorsepowerHorsepower

90mph Top Speed90mph Top Speed

The Engines and Drives: Beginning in 2004, CRE will produce a single 475hp

engine from the GM Vortec 8100, 496cid platform. Innovation and GM Powertrain

will assist in the design and production of the engine. A lease program in the

$6000-$7000/season range will be available as will an engine purchase program

that will cost substantially less than the Mercury Racing HP 525 that was used in

2003 as the standard Factory Class engine. The engines are CRE dyno tested,

sealed and certified for competition by Innovation. CRE oversees the program and

will conduct random spot checks through the season to ensure compliance with the

rules. Full on-site parts and service will be available as part of the program. CRE

also will be offering a trade-in program for used HP500 and HP525 engines that

will be designed to produce at a minimum a zero cost transition to the new spec for

participating teams. The Mercury Bravo XR, XZ and Sportmaster, and standard

Imco drives are approved for competition.

Factory 1 (designated by F1)

The Boats: Slightly smaller versions of the Factory 2 boats, these boats are stock

26' to 30' single engine production based v-bottoms with a fixed weight of 4750lbs.

These boats appear virtually identical to the pleasure performance v-bottoms that

can be purchased from a local new boat dealer. Minimum production number and

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dealer network requirements ensure that the boats are not dedicated race boats

produced by non-mainstream builders. Top speeds are approximately 80 mph.

Manufacturers include Baja, Fountain, Formula, Hustler, Extreme, Activator,

Kryptonite, Warlock and Eliminator.

The Engines and Drives: The engines and drives are the same as the Factory 2

boats.

Outlaw

This is Offshore’s grass roots divisional racing series and caters to the high

performance offshore sports boat market. The purpose of the series is to develop

new racers for the Pro Series classes. One of the most exciting aspects of offshore

performance power boating is the great diversity of engine and boat products

offered to consumers. The Outlaw Series shall be promoted as an exciting yet cost

effective way to showcase these products while complimenting the featured racing

offered by the Factory and Super Series boats.

29

100 boats100 boats nationallynationally

24-40’24-40’400hp-4000hp,400hp-4000hp,

Gas, Diesel,Gas, Diesel, TurbineTurbine

60-200mph60-200mph

Reindl Powerboats V-24 Series

The Boats: Exclusively 24’ Ocke Mannerfelt Design V-24’s manufactured and

sold by Reindl Powerboats. Known as the “Bat Boats”.

The Engines and Drives: Currently the Volvo Penta 315hp small block and DPX

stern drive.

Outlaw Performance Series

o PX – 110mph+ - Any boat and engine combination

o P1 – 100-110mph - Any boat and engine combination

o P2 – 90-100mph - Any boat and engine combination

o P3 – 80-90mph - Any boat and engine combination

o P4 – 70-80mph - Any boat and engine combination

o P5 – 60-70mph - Any boat and engine combination, provided,

however, that twin engine boats over 28’ capable of speeds in this range

must compete in P4.

30

Stadium Style Racing -

BEACHES DOWNTOWN BRIDGES

ORL races will be conducted using the “Stadium Style Racing” format

where the race boats compete on a relatively short (4-5miles) multi-directional

“roadcourse” style track situated immediately adjacent to fixed facilities such as

major downtown piers, bridges, or beaches. The key elements to the ORL Stadium

Style Racing program are as follows:

Spectator Excitement – Spectators can view the entire course from land

based primary viewing areas mere yards away from the racing action where

they can literally feel the spray of the boats and the roar of the engines.

Sponsor to Consumer Contact – Event venues are selected based on the

close proximity of the “racetrack”, dry pits, sponsor and vendor exposition

31

THE PIERTHE PIER

“The Stadium”“The Stadium”

areas, and primary viewing areas to ensure corporate sponsors, close, easy

access to the contact the fan/consumer throughout the event.

“Apocalypse Now Effect” - With up to 15 TV and rescue helicopters flying

directly overhead less than 50 feet off of the water and on the decks of the

race boats as they scream through the “stadium”, the visual senses of the

fans are stimulated beyond anything ever experienced at a typical

motorsports event;

Safety – These stadium courses, although more challenging and potentially

more dangerous, ORL commits greater rescue and safety assets to the teams

than ever before. Indeed, the Air/Sea Rescue program is entertainment in

and of itself as rescue divers deploy from helicopters from 20-50 feet above

accident scene mere yards from the spectators.

Short Courses - With multiple right and left hand turns to create more

thrilling, faster racing the 4-5 mile ORL courses create a super speedway

effect that often produces “trading paint” between competitors;

Low Production Costs – The “Stadium” costs approximately $700 in course

buoys. All other on-water production elements involve volunteers using their

own boats and equipment, and they love being part of the organization and

often times many will travel from event to event at their own expense.

32

The Offshore Powerboat Racing Circuits

Overview –

Since entering into the License Offshore has sanctioned a national racing

circuit consisting of 8-10 events per year, including a year-end World

Championship. Today the national circuit is sponsored by General Motors under a

4-year contract and is known as “The GMC Pro Grade Championship Series.

Under the License ORL also holds the exclusive sanctioning rights to the four-

divisional/divisional series, which collectively consist of another 15-20 races.

These series are commonly known as: the Pacific Offshore Series for the Western

Division; the Great Lakes Silver Cup Series for the Central Division; and the

Northeast and Southeast Divisional series for these sections of the country,

respectively. Offshore has sanctioned both national and divisional races in

California, Florida, Maryland, Canada, Texas, Michigan, New York, Georgia,

Massachusetts, North Carolina, Ohio, Arizona, New Jersey, and the Bahamas.

By necessity Offshore has focused most of its resources on the development

of the Spec Racing Program and national circuit and thus left the divisional series

and events to be managed primarily by volunteer members of APBA affiliated

clubs. As a result there has been virtually no joint planning or coordination

between Offshore and the clubs, which has led to scheduling conflicts and other

33

issues including a lack of development of these series, and significant missed

revenue opportunities for Offshore. In 2003, moreover, Offshore sanctioned AND

produced all of its 9 National Pro Series events thus enabling it to control all sales

and marketing, licensing, promotion, production rights, concessions and all other

event related revenue/profit centers. Unfortunately, Offshore did not have the

appropriate human and financial resources to adequately develop these profit

centers, which resulted in a further loss of revenue.

Under the new license these problems will be corrected through the

development of a comprehensive national and supporting divisional series racing

and related event business. The primary objective will be to organize and centralize

the planning and coordination process of the various series within the ORL much

like how NASCAR manages its national and divisional series (Winston Cup,

Busch Series, Craftsman Truck, Winston West, etc.). While the ultimate goal will

be to create a minimum of two major national professional circuits (15-20 total

events) and four complimentary divisional circuits (15-20 additional events) for

which Newco would serve as the exclusive producer and promoter. This in turn

will produce more revenue for the sanctioning body business of the ORL. More

importantly, the Divisional racing circuits need more professional management and

given the even lower production costs associated with these events, this need

presents an additional business opportunity for Newco.

34

The ORL National Circuit – GMC Pro Grade Championship Series

The Season –

Initially the ORL National Circuit, currently known as the GMC Pro Grade

Championship Series, will consist of a minimum of 9-10 separate events, starting

in April and culminating in a World Championships to be held annually in

November.4 The goal again will be to produce 15-20 national events each season

starting as early as February or March, in the South to take advantage of the

warmer weather, and ending in late November or early December for the same

reason. Additionally, a late November/early December season finale also should

help ORL to secure a broadcast network contract to televise its World

Championships live, given that all other motorsports have concluded their seasons

by then yet the demand for such content remains high among fans.

Site Selection Criteria –

Ultimately, Newco and the ORL will work together to determine the best venues

for the national circuit using the following site selection criteria:4 Attach tentative 2004 schedule

35

Body of water sufficient to stage a 4-5 mile racecourse located adjacent to a

fixed facility such as a public park, downtown waterfront, pier, or beach that

can be gated for purposes of charging admission to a minimum of 10,000

spectators.

The facility should be sufficient to stage the “ORL Experience” consisting of

race boat staging (Dry Pits), spectator viewing including main grandstands,

VIP, Corporate Hospitality, sponsor display, vendors, concessions, and

product exposition areas, so that fans can watch the races, interact with the

teams, view the boats and other sponsor displays and products, buy the

official foods and beverages, and purchase licensed ORL and Newco apparel

and merchandise.

The facility should be capable of staging a concert and related festival in the

same area.

Adequate parking within walking distance of the race viewing facility. The

need for shuttles or remote parking should be avoided in order to provide

fans an easy experience.

Close proximity to a resort hotel preferably within walking distance and

certainly no more than 10-15 minutes away by automobile.

Close proximity to a major metropolitan area, preferably a top 20 TV

market, major airport, and active business community.

36

Close proximity to sufficient support facilities such as marinas, crane and

fueling areas, boat ramps, grocery stores, and service stations.

Venues –

There are a number of venues within North America that satisfy most if not all of

these criteria.

Milwaukee, WI

Detroit, MI

St. Petersburg, FL

Tampa, FL

San Diego, CA,

Toronto, Canada

Orange Beach, AL

New York, NY

Cleveland, OH

Long Beach, CA

Savannah, GA

Charleston, SC

Hilton Head, SC

Chicago, IL

37

Ft. Lauderdale, FL

Miami, FL

Corpus Christi, TX

Sarasota, FL

Fort Myers, FL

Key West, FL

Seattle, WA

National Race Format –

These events will generally include 2 days of weekend competition. This

competition schedule is designed to permit the public to arrive early, experience

the boats and teams, secure their merchandise and apparel, food and beverage,

view the racing, repeat the process between events, and once Happy Hour

concludes on Saturday, proceed to the ORL Experience area for the evening

entertainment.

Race Boats - Super Series, Factory Series and Outlaw Series boats are

eligible to compete at the event. At this type of event the Outlaw Series boats will

compete on Saturday with the Super and Factory Series boats competing on

Sunday in separate races. The Sunday boats will also participate in an organized

38

testing session called “Happy Hour” at the conclusion of the last race on Saturday.

The boats will be required to test on the established racecourse to enhance the

entertainment experience for the fans. The personnel and equipment costs to ORL

are essentially fixed regardless of the venue.

Course and Race Length – The courses will be not more than 5 miles and

not less than 3 miles.

Saturday - There shall be 1-2 races on Saturday with each lasting

approximately 45minutes and no more than 45 minutes in between races for

refueling of the TV and Rescue helicopters. Happy Hour shall commence

within 15 minutes of conclusion of last race. Racing will start at 12pm and

all competition and testing should be complete by no later than 4:30pm

followed immediately by the Winner’s Circle ceremony.

Sunday - On Sunday there shall be two races. The early race shall consist of

the Super V classes and the second race shall consist of the Super Cat

classes. The racing shall begin at 1pm with the second race at 3pm. Each

race should last approximately 1 hour with no more than 1 hour between

race #1 and race #2. The racing should conclude by no later than 4:30pm

followed immediately by the Winner’s Circle ceremony.

39

Pro Series Championships

Pro Series National Championship Points will be awarded at every Pro

Series event to each boat competing in the event. The boat accumulating the most

points through the entire season in its respective class will be awarded the Pro

Series National Championship for that class.

Pro Series Sponsorship Opportunities

ORL sponsorship opportunities are set forth in the attached PowerPoint

presentation. Based on the performance of management over the past 4 years, ORL

will generate a minimum of $1,000,000.00 in annual series related sponsorship

revenues.

The ORL Divisional Circuits –

Overview

APBA currently sanctions Divisional races in four divisions throughout

North America: West, Central, Northeast and Southeast. These events have been

smaller in size and scope typically than the national events occurring mostly in

smaller communities and catering to divisionally based racing teams and fans. The

40

West, through POPRA, and the Central Division, through the Great Lakes Silver

Cup Series (“GLSCS”) generally produce 6-8 races annually which also are

televised on the Outdoor Network. A large group of racers from POPRA and

GLSCS also typically attend the annual World Championships. Due to the

independent Offshore Performance Association’s (“OPA”) presence in the

Northeast and the number of national events in the Southeast, moreover, there has

been very little Divisional racing in these divisions of the country.

Purpose

Notwithstanding the foregoing, however, ORL management believes that

Divisional racing can form a solid backbone for the business. Specifically,

Divisional Racing offers more opportunities to expand the ORL membership ranks

through relatively inexpensive grass roots racing programs. Divisional Racing

further offers more opportunities for Newco to add quality profitable events to its

portfolio and thus more sales opportunities, both incremental and value-adds, for

new and existing corporate series, divisional and local sponsors. Divisional Racing

also broadens the reach of ORL and Newco, the sport and, therefore, the benefits to

more people.

41

The Divisional Circuits and Management

Commencing with the 2004 season, the ORL shall sanction Divisional

events in four distinct divisional racing circuits in the West, Central, Northeast and

Southeast divisions of the United States and Canada. POPRA and GLSCS will

manage the West and Central Division divisional circuits, respectively. The ORL

intends to secure a mutually beneficial working relationship with OPA to manage

the Northeast divisional circuit and will directly manage the Southeast divisional

circuit from the central office. These individual organizations shall each be

referred to as a Divisional Management Organization or “DMO”. ORL also will

appoint an eleven member volunteer advisory council consisting of one

representative from each division as well as one from each of the six primary

racing classes, and a chairman to assist with the management of the Divisional

Racing Program. This new body will be known as the Offshore Advisory Council

(“OAC”).

Initially, management will encourage the OAC and each DMO to limit the

number of races in each division to 5-6 including Pro Series events. This would

enable the organizations to coordinate the Divisional and Pro Series schedules,

thus making it easier on and creating more options for the racers. This should also

make it easier for the ORL and Newco to oversee and assist the DMO’s with their

businesses and thus improve those businesses. The Company’s goal is for these

42

divisional events, although initially smaller in scope, to nevertheless use the same

basic Stadium Style Racing format as Pro Series events. In short, these events will

offer the same classes competing under the same format, and where possible will

be produced by Newco or at the very least overseen by Newco. These events also

should be held in locations strategically selected as potential Pro Tour sites.

Divisional Circuit Sponsor Opportunities

ORL and Newco also will offer series sponsorship opportunities for each

Division. The opportunities are set forth in the attached PowerPoint Presentation.

Again with the organization and centralization of the Divisional Racing Program

within ORL, sales of Divisional series related sponsorships, both incremental and

value adds to existing sponsors should increase.

43

ORL Management

Michael Allweiss – Chairman, CEO & President

Mr. Allweiss, 40, manages every facet of the ORL’s day-to-day activities and is

responsible for the formulation and implementation of the company’s strategic

plan. He became Chairman of the Category in 1999 and then succeeded to his

current position when the LLC was formed in 2000. He has served as a member of

the Category governing board and legal counsel for the Category. He has also

served on APBA’s national legal committee and on APBA’s national board of

directors. He is an accomplished racer as well achieving boat racing’s highest

honor in 1998 when he was inducted into the APBA Hall of Champions. In

addition to being a top competitor, Mr. Allweiss has produced several major

APBA Offshore events including 2 World Championships, a National

Championships, and 3 national races including the inaugural Savannah Offshore

Grand Prix and World Speed Runs.

Allen Allweiss – General Counsel

Mr. Allweiss, 68, manages ORL legal affairs. He is a Former Executive V.P for

Subsidiary Operations and General Counsel for the Home Shopping Network. He

has been a practicing attorney for over 40 years and has served as legal counsel for

the Category. He also is a former member of the Category governing board and a

44

successful former racing competitor as well, winning a national championship and

establishing a world speed record for his class in 1975.

Gordon Kraft – Executive Director of New Business Development

(FILL IN)

Mark Nemschoff — National Sponsorship Sales

Owner/CEO of Nemschoff Chairs, Inc., a large Wisconsin based family owned

company, which is the leading healthcare furniture specialist, as well as several

other manufacturing related businesses. (FILL IN)

Nigel Hook – National Sponsorship Sales

(FILL IN)

Steve Miklos – Executive Director of Competition

Mr. Miklos also serves as the General Manager for CRE. He is responsible for the

formulation of technical and competition rules and policy as well as the products

and services for CRE. He was largely responsible for the creation of the Factory

Series and current Super Series technical and competition rule platforms. As a

racer Mr. Miklos is a National and World Champion, and 4 time world speed

45

record holder. He still competes on a regular basis to stay connected to the sport.

He also is the Chairman/CEO of Suncoast Toner Cartridge, Inc. a leading supplier

of remanufactured toner cartridges, as well as several successful small businesses.

(FILL IN)

Jim Poplin – Vice President of National Race Operations

Mr. Poplin also serves as the Chief Medical, Safety and Rescue Officer for ORL.

He is responsible for the design, implementation and management of the race

operations plan at all Pro Series events, including but not being limited to the

medical, safety and rescue, and risk management programs. Mr. Poplin is a retired

firefighting paramedic and works outside of boat racing as the Chief of the

Hamilton County, Tennessee Special Tactics & Rescue Services, a special

operations tactical team on which many Offshore rescue team members also share

membership.

Theodore “Ted” Zoli – Executive Director of Special Projects

Mr. Zoli, 61, briefly served as the President and Chief Operating Officer for

Offshore before assuming his current post. He was originally retained in July of

2002 after a very successful and varied business career including Torington

Industries for which he served as President for the past 30 years. Mr.Zoli assists

46

each aspect of the business as an advisor and consultant, including but not being

limited to national race operations, and marine industry and race team

communications. He is a successful former racer and team owner as well.

National Staff Chiefs

Other key members of the ORL team include:

Randy Hegwood – Mr. Hegwood is the National Race Operations Director. His

duties include general race logistics management and implementation functions for

Offshore at Pro Series events.

Deanna Richardson – Ms. Richardson serves as the Executive Assistant to the

CEO. She also implements and manages the implementation of the Pro Series

sponsorship fulfillment program; and acts as the liason between executive

management and executive staff and related support staff/personnel, Offshore and

Pro Series sponsors, the television division, other divisions and affiliates.

John Potts & Robby Brooks – Mr. Potts and Mr. Brooks are Co-Executive

Producers of ORL Television. Each has over 20 years experience in the television

production industry. They are responsible for the production, assembly and

47

management of the television production crews, television production logistics,

distribution, sales and marketing, content and creative for the shows and

sponsorship television benefits fulfillment. (FILL IN)

Mike Tomlinson – Mr. Tomlinson serves as the Chief Referee for ORL and has

done so for the last 10 years. As such he manages the rulebook and rule

enforcement process. (FILL IN)

Paul Abreu – Mr. Abreu serves as the Chief Technical Inspector for ORL and has

done so since 2000. Prior to that he served for 20 seasons as an assistant inspector,

and assistant referee, as well as the chief inspector for POPRA. He manages the

technical inspection process at Pro Series Events. (FILL IN)

Dee Kimes – Ms. Kimes serves as the Chief Scorer for ORL and has done so for

the past 15 years. She manages the timing and scoring process at all Pro Series

events. (FILL IN)

Andrew Corn – Website Director

(FILL IN)

48

NOTE: The complete APBA ORL Organizational Chart is attached hereto as

Exhibit “A”

ORL Divisions and Affiliates

ORL Events

Produces and manages several different ORL controlled events, and manages

independently produced ORL sanctioned events, such as ORL powerboat races,

ORL personal watercraft races, boat shows, poker runs, speed record runs,

endurance runs, and ORL fishing tournaments.

ORL Television

Produces the television programs of ORL sanctioned or produced events and

manages ORL’s programming, broadcast and distribution rights and properties.

ORL Internet

Produces and maintains Offshore’s website and related video and audio broadcasts

of Offshore sanctioned/produced events including the delivery of relevant up to

date information to current and potential members, sponsors, and consumers, and

online sales of memberships and merchandise.

49

ORL Sales and Marketing

Develops, implements and manages all Sales/Marketing, Public Relations,

Publicity, Celebrity Participation and general promotion of the business and its

activities on the national series level.

ORL Membership Products and Services

Develops, implements and manages Offshore’s racing and non-racing membership

programs, including racer and consumer programs, products and services.

ORL Licensing

Develops implements and manages all licensing relationships for Offshore

including merchandising and apparel but excluding racing and marine performance

related products and services.

Certified Racing Equipment

Administers the technical rulemaking and enforcement programs for Offshore’s

racing activities, and also administers the sales and licensing of “APBA Offshore

Proven” marine related products and services to race teams, and outside third party

vendors of boats and marine related products and services. This is a separate

Florida corporation that holds a license from Offshore to perform its functions.

50

Objectives – In General

1. Continue to develop a competition based rules model for its racing

operations that emphasizes:

a. Competitive balance for all participants;

b. Affordable racing for all participants;

c. Close, exciting competition for everyone - multiple winners

51

2. Continue to develop a professional staff that effectively develops,

implements and manages the rules making and enforcement process with fairness

and integrity.

3. Continue to develop a professional staff that effectively manages the

offshore racing specific logistics and operations at the events.

4. Develop a strong, stable national racing series schedule with events in

major metropolitan areas or destination locations.

5. Develop a strong national sponsorship and racer contingency sales

program.

6. Develop a strong prize money program for the race teams.

7. Produce first class, high quality, exciting television entertainment.

8. Produce an exciting, interactive, informative and entertaining Internet

presence.

9. Produce high quality product licensing, merchandising and apparel

programs.

10. Produce effective and informative public relations and media programs.

11. Produce consumer oriented affinity membership programs.

Conduct business in a manner that enhances and promotes the ORL brand and the

sport of offshore powerboat racing for the benefit of all of our business partners.

52

Economics of ORL

Overview

The sanctioning body business has experienced tremendous growth since

1998 when the Category still operated under the control of APBA. Specifically, in

1998 total revenues were less than $350,000. The average fleet count at national

races was less than 50 boats and the World Championships that year yielded only

53

68 boats. In 1998 APBA had two primary competitors in the offshore powerboat

racing sanctioning body business: US Offshore (USO) and SBI. Both organizations

achieved similar results that year.

In 1999, which was the first year under current Chairman Michael D.

Allweiss and the last year the Category operated under APBA control, series

sponsorship sales increased to approximately $350,000 and total revenues

exceeded $1million. The average fleet count increased to over 65 boats per event

and the World Championships had over 100 boats in attendance. In 2000,

Offshore’s first year of operations, sponsorship sales exceeded $750,000 and total

revenues were slightly less than $2million. Offshore had a tax loss of only

$187,000. The average fleet count increased to over 90 boats per race and 146

teams attended the World Championships.

In 2001 Offshore’s sponsorship revenues grew to over $1,000,000.00 despite

the severe downturn in the U.S. and World economies. Total revenues exceeded

$2million for the first time in APBA history. The financial bottom-line for

Offshore improved substantially over the previous year due to Management’s

decision to drop its TNN television package in favor of increased coverage on

Speedvision while maintaining its full compliment of sponsors. The loss from

54

operations was approximately $100,000. The total Pro Series boat count was down

slightly in 2001 due primarily to class consolidation and the economy.

In 2002 sponsorship sales declined approximately 20% due to a number of

factors including the continued economic recession, the severe decline in the

sponsorship and advertising markets overall, the virtual depression experienced by

Offshore’s primary sponsorship market, the high performance marine industry, and

Offshore producing its own national events. Overall revenues also decreased due to

a further reduction in the number of teams able to participate due to the continuing

economic recession.

In 2003, the number of participants increased by about 10% over the

previous year. Unfortunately, Offshore experienced four significant yet

unforeseeable negative events that impacted the business financially. First, certain

members of APBA unlawfully attempted to terminate the original License. Second,

these same members unlawfully attempted to rescind a properly approved

corporate restructuring of APBA that provided substantial financial benefits to

Offshore and protected its long term interests and investment in the sport.

Third, Mercury Racing management, angered by what it perceived as GM’s

encroachment on its market, unlawfully terminated its sponsorship agreement with

Offshore and refused to pay the remaining $100,000 balance due. Mercury Racing,

though one of its top executives, Fred Hauenstein, also assisted the efforts of the

55

above referenced APBA members, and publicly yet falsely accused Offshore of

failing to perform its contractual obligations and questioned its future under the

License. Fourth, the LLC finance member reneged on his obligations to fund

company operations through the balance of the year after causing the company to

incur costs it otherwise would not have incurred, including on sales and marketing

personnel who failed to produce any offsetting revenue.

These led to expensive and time-consuming litigation; uncertainty among

sponsors, racers, fans, potential sponsors and event sites, a loss of focus on the core

business and a refocusing of human and financial resources on expensive non-

revenue producing activities, which led to a substantial loss of income.

Nevertheless, management prevailed in all related litigation and secured a

favorable settlement, which included a new and improved License arrangement

with APBA. The settlement also enabled management to lawfully reconstitute their

ownership group by eliminating certain members, and restructure the business, in

the form of KHAMAN and the ORL. Most of the past obligations have been

satisfied through loans from the remaining LLC members and drastic reductions in

overhead during the past 90 days. By virtue of these aggressive moves by

management, the expected annual cash infusion from 2004 memberships, boat

registrations and World Championships entry fees, will enable the ORL segment of

the business to commence the 2004 season in a relatively stable financial

56

condition, thus paving the way for the implementation of the new business plan

including the creation and capitalization of Newco.

Overall, the economics of the ORL are favorable for future growth and

profitability, thus increasing the value of the enterprise to third party investors or

purchasers. Specifically, with the successful development and implementation of

Newco, the ORL fixed costs will remain very stable over the next 3 years even

while revenues grow at a faster rate. In other words, while revenues grow fixed

expenses will not, thus increasing ORL profitability. The reasons are three fold: 1)

the core sanctioning body business relies primarily on volunteer labor for the

execution of its event production responsibilities; 2) national series sponsorship

sales primarily are executed and managed by ORL shareholders who are

compensated through commissions, with some outside commission sales

assistance; and 3) ORL derives revenues primarily from sources which do not

require additional personnel as those revenues increase. Most of the benefits

contained in series sponsorship packages for example are self-executing, such as

those related to television, or are fulfilled on site by dedicated volunteers such as

signage placement and VIP hospitality.

Revenues

The 2004 revenue projections for ORL are attached hereto as Exhibit _.

ORL is profitable upon start-up assuming a slight increase in national series

57

sponsorship revenue; provided that Newco assumes the event production business

and corresponding expenses, and pays ORL a $50,000.00 sanction fee for each Pro

Series event. In the first year, however, the profit shall be applied against the

remaining past due expenses and the debt owed to the LLC members, which ORL

assumed from the LLC. In the first 5 years, the profit shall be further limited by

ORL’s agreement to limit sanction fee increases in order to assist the growth and

development of Newco’s business. By the end of this initial 5year period, however,

Newco should be profitable and thus able to pay fair market value sanction fees to

ORL.

Series Sponsorships

Series sponsorships typically consist of a package of benefits that includes

television commercials, in-focus exposure, in-show brand features, on site display

opportunities, VIP opportunities, and on-site signage. Management has

consistently generated $500,000 - $750,000 in national series sponsorship income

over the past four years. The GM contract runs through 2005 and pays ORL

$400,000.00 annually. The Sterling contract runs through 2006 and pays a

minimum of $150,000 annually thus yielding a guaranteed $550,000 each of the

next two years. ORL also has secured an additional $155,000 in verbal

commitments for next season and projects another $290,000 in sales over the next

5-6 months based on current discussions with interested potential sponsors.

58

The ORL has secured these sponsorships and commitments primarily

through the efforts of its ownership group. Michael Allweiss, Mr. Nemschoff and

Mr. Hook will continue those efforts on a commission only basis, and they project

annual sales to grow to $1,500,000 by 2006. With the formation of Newco and its

corresponding assumption of the event production business, and formation of its

own national sales staff, ORL Management does not expect to add new sales

personnel for at least the next 3 years. Series sponsorships represent approximately

38% of ORL gross revenues. Due to its relatively fixed overhead and event

production costs, however, ORL profit margins will grow corresponding with the

projected increase in ORL generated sales.

Competitor Contingency Sponsorships

These sponsorships generally come from marine related product suppliers.

Teams receive product and/or money for using the product and finishing usually in

the top three at an event and/or for the season high points race. ORL must develop

such a program to attract more competitors and lengthen the commitment of

current racers. ORL will receive only a very small percentage of any such

sponsorship to administer the program. Management will spend the 2004 season to

research and develop a workable program for implementation in 2005. The

financials do not reflect any income from this source for the first three seasons.

59

National Television Advertising

For the next three seasons ORL shall continue marketing and selling its

television inventory as part of bundled series sponsorship packages. Thus,

management does not anticipate any revenue derived from sales of strictly

commercial inventory or in-show graphics and features.

Sanction Fees

Sanction fees are monies paid to the sanctioning body for the right to

produce an ORL sanctioned event. The Pro Series sanction fee provides the

producer with a guaranteed event date on the Pro Series calendar at which the top

Pro Series boats will compete for national championship points. In 2004-

2005Newco will pay ORL a set sanction fee of $50,000 for each Pro Series event.

Beginning in 2006 the sanction fee shall increase 15% annually through 2008 at

which time management will re-evaluate the fee structure along with Newco

management. This fee arrangement will allow Newco to become profitable sooner

but still return a slight profit to the ORL. The sanction fees represent

approximately 20% of ORL gross revenues.

Entry Fees

ORL charges entry fees to competitors to enter Pro Series events in

accordance with a published fee schedule. The fees are set on a class-by-class

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basis. Historically the conducting club retains entry fees for divisional events.

Going forward, however, ORL will standardize the fee structure for Newco

produced events and the fees will be split according to an agreed upon schedule.

This arrangement will yield more revenue for both ORL and Newco. Currently,

Pro Series entry fees account for approximately 22% of ORL gross revenues.

Boat Registration Fees

ORL also charges a one time annual equipment registration fee for each

individual raceboat that competes in any ORL sanctioned event. These fees should

be increased on an annual basis to keep pace with inflation. Currently, these fees

account for approximately 6% of ORL gross revenues.

Membership Fees

ORL shall produce a comprehensive, valuable, consumer oriented affinity

membership. The current total membership of ORL, consisting of racers, race

officials and non-racers, is approximately 1500. The purpose of the plan is to

increase ORL annual membership revenue and significantly grow the customer

base in order to efficiently and cost effectively serve its licensing and

merchandising program and thus increase its overall net earnings. Other

sanctioning bodies such as NHRA (85,000 members), SCCA (55,000 members),

and the AMA (250,000 members), have done this with great success.

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Once Newco is created and properly capitalized, ORL shall engage in a

concerted membership campaign to grow its non-racing membership. This plan

will have several key components:

First, ORL will develop several levels of membership from a low cost base

package to a high-end premium package that will be offered on a limited and

semi-exclusive basis. Direct mail, Internet, television, event and voice relay

shall be used to market and advertise the membership program;

Second, ORL will leverage its relationships with its marine industry

sponsors to include these packages as an added value to the products sold to

the sponsors' customers. For example, as a method of further promoting

Formula products and its relationship with ORL, Formula will include

APBA ORL membership displays in its dealerships and/or include the

memberships as part of each boat sold. This way a sponsor can get the word

to its customers about its relationship with ORL and drive these customers to

ORL events where it can continue to develop the customer relationship;

ORL shall expand its current relationship with MBNA as part of the base

membership marketing program;

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ORL shall include an insurance component as part of its base membership

package in much the same way SCCA and NHRA do in their respective

programs;

Membership fees currently account for approximately 10% of ORL gross revenues.

Licensing

Apparel

Merchandise

(FILL IN WITH LEROY BUSH INFORMATION)

ORL currently has no licensing plan with respect to merchandise and apparel

however, management is working on such a plan. Historically, sanctioning bodies

make very little revenue marketing and selling merchandise and apparel that

exclusively feature its logos. The key to a profitable program is to market and sell

the stars of the sport and team merchandise and apparel bearing the ORL logo.

ORL charges a license fee for use of the logo either in the form of a flat fee or a

percentage of sales. The most cost effective way for ORL to generate license fee

revenue is to grant third parties the right to market and sell the merchandise and

apparel, thus eliminating any costs associated with that and with fulfillment.

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Racing Related Products and Services

CRE handles this part of the ORL business and while it currently accounts

for less than 1% of ORL gross revenues it has the greatest potential to generate

significant financial returns in the future. For example, CRE was responsible for

validating the GM Vortec 8100 HP3 engine now in use in the Super V and Super

Cat Light classes, and thus the GMC title sponsorship. CRE has also developed

solid business relationships with Sterling, Herring Propellers, Hydromotive

Propellers, Imco Sterndrives, and Innovation Marine, the largest re-power center in

the United States. Together, these entities control a huge segment of the very

profitable high performance marine propulsion market. Going forward, CRE will

design and implement a business strategy to strengthen, tighten and take further

advantage of these alliances to produce additional revenue for itself and ORL.

Expenses

The 2004 expense projections for ORL are attached hereto as Exhibit _. The

traditional sanctioning body business has long been profitable. Indeed,

Management has been acutely focused on developing the racing product over the

past several years. Unfortunately, the lack of professional promoters willing to

develop the event side of the business left management to handle this critical task.

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Management, however, had neither the human nor financial resources to

adequately address the need for a comprehensive event production and promotion

program. When combined with the APBA and Mercury Racing related problems in

2003, this event issue became more acute particularly from a financial perspective.

This also led to management’s decision to restructure the business and create

Newco. Provided that Newco assumes the event production business and

corresponding expenses, and pays ORL a $50,000.00 sanction fee for each Pro

Series event, ORL can focus on the traditional sanctioning body business. This in

turn, will lead to a much-improved product for Newco to market and sell, and long

term profitability for the entire business. The 2 primary categories of expense are

Event Related and General Overhead.

Event Related Expenses

Event related costs constitute the largest category of ORL expenses,

accounting for roughly 65% of the total. These expenses can be classified as: 1)

staff related such as compensation, expense reimbursements and travel/lodging; 2)

hard costs that are primarily comprised of prize money and event insurance; and 3)

television, which will be handled separately below.

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National Staff

Management anticipates adding very few additional staff over the next three

years so those costs should remain relatively stable. This is primarily due to the

Spec Racing Program, which requires far less personnel to manage and enforce

effectively even if the number of competitors and registered race boats increase

significantly over that period. In addition, much of the on-site personnel is made up

of local volunteers who are managed by the national staff. As Newco and ORL

solidify a consistent national schedule, the amount of time necessary to manage

these volunteers also decreases thus enabling ORL to tightly control the growth of

its event related staff even more.

Prize Money and Insurance

Insurance costs may rise 10-15% over the next three seasons, but the

additional revenue generated by the small increases in sanction fees will cover

these increases. Prize money on the other hand is a fixed expense that will rise only

with a commensurate increase in revenues. Nevertheless, one of management’s

chief goals is to double the prize payouts at the Pro Series events by the 2006

season from $50,000 to $100,000. Management anticipates being able to do this by

taking advantage of the increased margins created by increasing series sponsorship

revenue over the relatively fixed expenses associated with the Spec Racing

Program. Increased prize purses are important to the overall success of both ORL

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and Newco in that it helps to professionalize and stabilize a larger more consistent

base of national and divisional competitors as demonstrated historically in other

sports.

Television Production

Television is a critical component to the future growth and success of the

ORL and Newco. The leaders of the two most widely recognized motorsports in

the world, NASCAR and Formula One, recognized this early on and designed their

respective businesses around an aggressive television product and distribution

plan. However, NASCAR did not secure its current groundbreaking television

package until its member racetrack owners ceded their authority to negotiate

individual network contracts to the sanctioning body. ORL already has exclusive

authority to negotiate the television deals for all of the National and Divisional

racing events. With Newco and ORL closely aligned, however, management for

both organizations shall work together during any future network negotiations to

secure the best deal for the overall business. In 2003, television accounted for

approximately 30% of ORL gross expenses.

Program Distribution Plan

For the 2003 season Offshore had contracted for a minimum of 20 hours of

programming on the Fox Speed Channel (“Speed”). The contract required Offshore

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to buy this time for $150,000. To date, Offshore has produced the requisite number

of programs but has not paid any of the time buy. Discussions between

management and Speed are ongoing and it appears that the network will continue

to take the programming for the time being.

Speed has indicated, however, that it is not inclined to enter into talks about

2004 and beyond without a commitment from Offshore to pay the time buy for

2003. ORL thus may have to assume that obligation in order to secure a new deal.

Another potential option is for GMC and ORL to approach Speed together on

restructuring the relationship. Speed has indicated it might consider a plan that

eliminates the past and any future time buys if GMC increases its advertising

spending with the network. Management has had very limited discussions with

GMC on this subject but plans to aggressively pursue this option in the offseason.

In the short term, Speed remains the best option for the ORL television

product. The Outdoor Life Network (“OLN”), with similar distribution, is another

option as is the much smaller Outdoor Network. In the long term, ORL should

secure a broadcast network contract to televise at least one of its World

Championships races live. Ultimately, the distribution plan should include a

package with Speed for most national and divisional events, and a broadcast

network for tape delay broadcasts of designated “major” events, and at least one

live broadcast of the World Championships on an annual basis.

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Program Content Plan

For the short term the content plan for the GMC Pro Grade Series events is

as follows:

ORL Television shall produce a one-hour season preview show featuring the

top teams from each of the 6 primary classes, with particular emphasis,

however, on the Super Cats and Super V’s.

ORL Television shall produce two separate and distinct one-hour shows for

each of the regular Pro Series season events. One show will be dedicated to

the v-bottom classes featuring Super V while the other show will be

dedicated to the catamaran classes, featuring Super Cat.

ORL Television shall produce a one-hour mid-season review show.

ORL Television shall produce a one-hour Worlds Preview Show.

ORL Television shall produce three additional worlds programs, one

featuring the mid-week races and the other two featuring the weekend

“finals”.

ORL Television shall produce a one-hour season in review show.

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General Overhead

This category includes the general expenses necessary to operate the ORL

on a day-to-day basis and accounts for roughly 35% of the total expense budget.

This figure includes the annual license fee that ORL must pay to APBA under the

new License.

Administrative

The Administrative expenses to operate the ORL, including rent, utilities,

salaries, commissions, travel and general office account for approximately 30% of

the total expense budget. Over the next three years the ORL will not need to

expand either its office space or the number of paid full time employees because

the operation is fully automated. The official ORL website offers a host of online

services including event registration, annual equipment registration and

membership application and processing. The Spec Racing Program also

significantly reduces the volume of participant inquiries so from a customer service

standpoint the ORL is adequately staffed even assuming significant growth in

membership.

The Spec Racing Program also requires only minor maintenance from a

rules review and amendment standpoint, thus obviating the need for any additional

personnel dedicated to that task. The same applies to the enforcement aspects of

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the Program at the events. The technical inspection team is adequately staffed and

compensated for the next three years even assuming a 30% increase in the fleet.

Moreover, even if the need for additional personnel arose, these would be part-time

modestly paid sub-contractors who would render services on an event-by-event

basis.

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Promotion and Public Relations

(FILL IN)

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Internet

Drew Corn manages the website. He is currently redesigning the site for the

upcoming season. Adding a “Store” is his top priority and he is working with Tim

Green on this project. The site will be used for news, information on upcoming

events, event results, and company generated press releases relating to events and

the overall business.

(FILL IN)

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The Market

The relevant market of potential consumers of the ORL and Newco products

is the recreational boating industry. In 2001 nearly 70,000,000 people participated

in recreational boating activities in the United States. Consumers, moreover, spent

more than $25,000,000,000.00 at retail in 2001 for new and used boats, motors and

engines, trailers, accessories and other associated costs.

In addition, there are now over 15 million registered powerboat owners in

the US alone and that number is growing annually. These numbers should grow as

the US economy continues its recovery.

ORL is uniquely positioned to capitalize on this growing market for three main

reasons: First, the primary and nearly exclusive event sales and marketing tool for

the marine industry today is the boatshow. These exhibitions are generally static

displays of available boats, engines and marine accessories but offer little to no

entertainment value to the consumer. ORL events offer the same display

opportunities, plus a unique entertainment, VIP and corporate hospitality

environment sponsors. In addition, ORL events offer perfect opportunities for

poker runs that benefit the high performance boat builders and dealers, and

excursion/getaway opportunities for cruiser and yacht makers and their dealers.

ORL events also offer a very different interactive experience for consumers from

the high-pressure environment of the typical boat show.

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Second, since GM provides nearly all of the engines for the inboard marine

industry, ORL offers GM a unique opportunity to communicate its “under the

hatch under the hood” message directly to its target truck and SUV customers (i.e.

non-GM vehicle owners who do own GM powered boats) without the usual

competition from other automakers. In short, GM values the ORL relationship

because it produces incremental truck and SUV sales in a cost effective manner.

Third, GM is the exclusive supplier of inboard engines to Brunswick owned

Mercury Marine, which in turn is the largest supplier of marine power to the multi-

billion dollar portfolio of Brunswick owned boat companies. Since Mercury

historically has been the dominant force in offshore racing engine and propulsion

systems, it has a similar opportunity to communicate directly with its target

customers at every level of its product offerings without interference from its

competition. The synergies of all three companies create a very compelling

business case for a joint sales, marketing and promotional effort around the ORL

events and television product.

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The Competition

In 1998 APBA had two primary competitors in the offshore powerboat

racing sanctioning body business: US Offshore (“USO”) and Superboat

International Productions, Inc. ("SBI") which is a small organization based in Key

West, Florida. Limiting the scope of the industry to domestic offshore powerboat

racing, today the competition comes from only SBI, which has no national

infrastructure and a very small membership base in comparison to ORL. USO is

out of business and SBI has lost virtually all of its corporate support and national

television exposure and is averaging approximately 20 boats per event. Also, SBI

has no coherent event-marketing program and suffers from chronic gross under-

capitalization. SBI also caters to outdated and non-conforming equipment that is

generally uncompetitive or illegal for ORL competition. SBI, however, is a

potential acquisition target and management has undertaken some very preliminary

discussions with people close to SBI ownership for that purpose.

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NEWCO

OVERVIEW

Over the next four years, Offshore’s primary strategic goal and objective will be to become the premier offshore boat racing sanctioning body in the United States and thus a well recognized, highly respected, and financially successful motorsport entertainment property. To do this Offshore must concentrate on developing its core sanctioning body business. The elements of this business:

o Racing Product – includes racing classes and related technical and competition rules, as well as management and support personnel.

o Race Event Organization – includes sanctioned events produced by independent organizers and by the affiliated events company.

o Membership – includes racer and consumer programs, products and services.o Sponsorship Sales – includes series, event and contingency programs.o Television – includes the production and distribution of race events related

television programs.o Internet – includes the design and maintenance of an official website which

delivers relevant up to date information, and audio and videocasts of its events to current and potential members, sponsors, and consumers, as well as potential members and sponsors.

o Promotion of the Business – Public Relations, Publicity and general promotion of the business and its activities.

Management firmly believes that for the business to grow and be successful, the sanctioning body must be strong and stable. Thus, the goals and objectives for 2002-2005 can be summarized as follows:

o Near Term – 2002 Season Raise $500,000 in operating capital Complete the 2002 schedule but eliminate St. Petersburg and Atlantic City

and add the Bahamas Collect remaining accounts receivable Resolve Crouse and TNN litigation Create $199.00 premium fan/consumer oriented membership and sell 150

of such memberships by year end Communications

Create email database and identified groups for mass communications for racers, members and staff.

Vision

o Short Term – 2003 Season National Sponsorship Sales

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Contingency Sponsorship Sales Event Sponsorship Sales Television Internet Promotion and Public Relations

o Intermediate Term – 2002-2005 Class Rules Development Technical Rules Development Competition Rules Development Staff Schedule Membership National Sponsorship Sales Contingency Sponsorship Sales Event Sponsorship Sales Television Internet Promotion and Public Relations Capital Raising Campaign

o Long Term – 5-10 Years Exit Strategy

Offshore will seek strategic licensing relationships with qualified business partners to help it design and execute many of these programs.

Additionally, Offshore seeks approximately $1.0 million in financing to enhance the operations and management of Offshore’s business activities and further assist it in the achievement of its goals and objectives. The funds will be used primarily:

1. To develop a national sponsorship and racer contingency sales organization;2. To develop a national race event production/logistics organization.3. To build a management team that will allow APBA Offshore to grow and develop its

national and divisional racing series.4. To allow Offshore to expand the scope of its television, public relations, promotional,

membership, retail sales and internet programs.

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5.4 Projected Use of Funds

The Company intends to use a portion of the funds raised to hire the necessary professional personnel, purchase the necessary equipment, and satisfy any shortfalls in the Company’s cash flow needs for the first year of operation

5.5 Exit Strategy

5.8 Company Vision and Goals

5.8.1 Vision

The Company’s vision is to create a total motorsports entertainment company which produces made for television championship offshore powerboat races and supporting family oriented festivals that benefit worthy charities, on a for profit basis.

5.8.2 Core Philosophy

5.8.3 Core Purpose

The core purpose of the Company will be to establish offshore powerboat racing as a premiere American motorsport which rewards its participants and their families, as well as its fans, volunteers and charities, with a wonderful all around entertainment and life experience.

5.8.4 Core Values

The customer is always right The racers always come first. Sacrifice in the short-term and the long-term will take care of itself. Reward positive attitudes and enthusiasm among employees. Reward the volunteers. Cultivate a culture of honesty and integrity within the organization. Turn problems into opportunities. Believe and you can achieve.

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Teamwork. Charity and Service

5.8.5 Goals

5.8.5.1 Intermediate Goals: 1-10 years

Create viable for profit motor-sports entertainment production company. Establish credibility of entity as well as the look and feel of our product. Increase membership to 100,000. Average 100 raceboats at all Pro-Tour Events. Produce 26 1 hour TNN shows each season.

5.8.5.2 Near Term Goals

1999

Establish infrastructure Implement business model Implement new racing specs Finalize licensing deal with APBA

2000

Capitalize the entity Successfully produce 4 profitable Pro Tour Series events, each with a minimum

of $100,000 in prize money, and at least 10 TNN shows. Increase membership to 10,000. Implement the Super Series, Factory Series and Outlaw Series competition

models. Break-even

5.9 Market Analysis

5.10.5Membership Marketing

5.11 Operations

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The Company will essentially become a motorsports entertainment company, producing and managing events and television broadcasts of the racing associated with those events. It will sell event and television related entitlement sponsorships as well as offshore racing related merchandise. The Company also will deal with rules and technical issues relating to the boats and the conduct of its races and must deal with all of these issues from an operations standpoint on a daily basis.

6. 7. Racing

7.2.3 The Family Oriented Entertainment Festivals

Each Pro Tour and Divisional Tour event will be held in conjunction with a family oriented entertainment festival designed to generate profits for the company through area and event sponsorships, admissions charges, merchandise sales, participation fees, and concession sales. These festivals will generally be 3-5 days long. The standard model will include most if not all of the following events, areas and activities:

Golf, fishing and/or tennis tournament(s) Charity auction Manufacturer's expo Kid's activities areas Wet and Dry pit viewing areas National act concerts on at least one evening Fireworks show on at least one evening Boat show Retail merchandising and sponsor display/sampling areas Winner's Circle Offshore powerboat racing

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Introduction

APBA Offshore Launches A New Era of Professional Offshore Powerboat Racing

For the past 100 years offshore powerboat racing has been little more than an unorganized, unstructured, hobby for rich boys and their expensive toys. The revolution from hobby to professional motorsports entertainment franchise actually began in 2000. That is when a group of entrepreneurs entered into an exclusive 99year License with the American Power Boat Association (APBA) the largest and oldest governing body for powerboat racing in the United States. The revolution is now over and the businessmen have won. Today, APBA Offshore launches a new era of professional offshore powerboat racing with the laser like aim of becoming the next great motorsport entertainment property.

o Company Profile APBA

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o 100 years old - oldest motorsport sanctioning group in the United States

o Exclusive national authority for UIM – world governing authority for all of boat racing

o Offshore holds an exclusive 99year License Agreement from APBA to operate, manage, market and sell the sport of offshore racing and related events

Depth of Mgmto Marketingo Public Relationso Operationso Legalo Financeo Membershipo Sponsorshipso Televisiono Technologyo Entertainmento Celebritieso Event Management and Marketingo Competition Management o Investor Relations

o Innovation – why we are different from any other motorsports entertainment company – “More than just a sanctioning body”

The lowest cost operatoro Leveraging of higher margins with lower

overhead as revenues grow resulting in huge percentage of revenue dropping to bottom-line. “Cashcow”

o Biggest, most colorful and aesthetically exciting racing machines of any kind yet the

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least expensive to buy, power and campaign relative to other top tier national professional motorsports

Vertically integrated marine motorsports entertainment companyo Event production, management and sales

capabilities, television production and related sales capabilities

o Participant Membership Programo Rules-making and enforcemento Competition management. o Affinity Membership Programo Owns and maintains exclusive control over the

licensing, sales and marketing and production rights to the events, the Pro Series and all related television.

o Stadium Style Racing Past

o Long courseso Out of sight of spectatorso Participant driven sporto What fans?o High attrition rates due to uncontrolled

technical rules model Today

o Short courses, more thrilling and dangerous and faster racing

o Closer more exciting competitive racing through corresponding tight competition based technical rules management.

o We trade paint! o Spectator Excitement – view the entire course

from primary viewing areas with the fleet only yards away – feel the spray and the roar.

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o “Apocalypse Now Effect” with tv and rescue helicopters flying directly overhead less than 50 feet off of the water and on the decks of the race boats as they scream through the “stadium”

o Courses are more challenging and dangerous with the greater rescue and safety assets committed to the teams.

o Air/Sea Rescue program is entertainment in and of itself.

o Our “Stadium” costs = $700 in course buoys AND we only have to buy buoys once every few years!!!!

o Greatest motorsport entertainment value to the spectators, sponsors and participants = low, low ticket prices affordable for the entire family

o Huge Growth Opportunity Relevant Market

o Over 70 million people participated in recreational boating in the United States in 2001

o Over $25Billion spent on new and used boats and equipment in 2001

o High level of brand loyalty o Upper Income Demographico Cross Marketing potential with non-marine

related retailers and consumer products and services

Number of Events o Pre-APBA Offshore Acquisition – 6 with only

2 secure, none in major markets or true destinations, and none controlled or owned by Offshore – direct satellite television only

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o 2002 - 8 nationally televised Pro Series events 12 smaller divisional events

o The Future – 100% Growth + expansion into other areas such as bill fishing tournaments, boat shows and endurance jet craft racing

Media (Television, Radio, Internet, Print)o Pre ABBA Offshore Acquisition – direct

satellite television only – 12million home penetration; no radio; no internet and no official website; small black and white newsletter

o 2002 – Fox Speed Channel – over 50million home penetration, over 80 hours of tape delay programming, time buy/barter; live radio at each event; live internet broadcast at each event on APBA Offshore.com; color program at each event, 120 page program for the World Championships

o The Future – Major Broadcast Networks and Cable, Live Programming, Rights Fees, Pay Per View, Special Features, Movie; APBA Radio Network; live internet streaming video of each event on APBA Offshore.com; Annual Guide to the sport, APBA Offshore Magazine

Membership Programso Pre-APBA Offshore Acquisition – Participants

= 300; General = 800o 2002 – Participants = 700; General = 1300o The Future – Participants = 2000; General =

80,000 Licensing, Branding and Co-branding

o Pre-APBA Offshore Acquisition - Noneo 2002 – minimalo The Future

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o Merchandiseo Apparelo Die Casts and Toyso Product Endorsements = “APBA

Offshore Race Proven”o Games

Video Online

o Race Marine Products and Services (“Certified Racing Equipment - CRE”)

o Recreational Marine Products and Services

Sponsorshipso Pre-APBA Offshore Acquisition – 3 sponsors

and $150,000 cash, minimal in-kindo 2002 – 100+ sponsors and $3,000,000+ cash

and in-kindo The Future - $25,000,000+

Admissions – the “Gate”o Pre-APBA Offshore Acquisition - $0o 2002 – $600,000 (Avg. $10/person) with only

4 venues gated o The Future - $10,000,000+ (does not include

VIP) Concessions (Parking, Beverage, Food, etc.)

o Pre-APBA Offshore Acquisition - $0o 2002 – $100,000o The Future - $5,500,000+

Concertso Pre-APBA Offshore Acquisition - $0o 2002 – 1st Major Concert to be introduced at

the upcoming Key West World Event

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o The Future – “APBA Offshore Rocks” Concert Series

o Marine Industry Competition Pre-APBA Acquisition – highly fragmented and

loosely regulated with multiple sanctioning groups 2002 – APBA Offshore is the unquestioned leader in

boat racing with one small private niche group remaining

The Future – APBA Offshore becomes the premier marketing vehicle for the marine industry in North America and the Caribbean

o Marketing, Advertising, Public Relations and Promotion Pre-APBA Acquisition – very limited television

exposure, no promotion, marketing or advertising of any kind

2002 – Aggressive and highly integrated program including public relations, national television, radio, and internet, plus direct mail, print advertising, cable television advertising, telemarketing, signage and billboards, cross promotions and cooperative advertising, brochure distribution plan, newspaper inserts and flyers, government relations (TDC’s and CVB’s) etc. on an event by event basis

The Future – Exponential increase in these programs for each event as well as a series basis, cross promotions and advertising with other “non-competitive” sports and entertainment

o Celebrity Involvement Pre-APBA acquisition – None 2002 – Teen Singing Idols Nick Carter and Aaron

Carter, Darian Hatcher (NHL), Rusty Wallace (Team Owner), Rock Group “No Secrets” with more under

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negotiation for appearances at the Worlds. Celebrity involvement this year resulted in an expansion of the APBA Offshore fan demographic to include a much younger audience and guarantee a long term, loyal fan base

The Future – APBA Offshore Celebrity Advisory Board led by prominent Manhattan Entertainment Attorney Steven Beer. Comprehensive Celebrity Program to include promotions, special appearance, APBA Offshore product endorsements, enhanced media exposure, broader demographics

o Economic Impact to Participating Communities Pre-APBA Acquisition – minimal; small attendance

and participation bases 2002 - $6-12million based on the venue and length

of event The Future – exponential growth with increase in

exposure, fan and participant bases

Strategic Objectives

Inject professionalism into the sport Broaden the sport’s appeal and accessibility Create multiple channels for marketing

Injecting Professionalism into the Sport

Brought law and ordero Established guidelines, regulation, management

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Leveled the playing fieldo Introduced and enforced boat weight and power plant

limitations, cracked down on infractionso Ensured tight competition-based technical rules

management

Results:

o Greater pro sports legitimacy and credibilityo More participants, rid the sport of infractorso Closer races, more competitive excitemento Previously highly fragmented and loosely

regulated with multiple sanctioning groups –> APBA Offshore today is the unquestioned leader in boat racing with one small private niche group remaining

Broadening the Sport’s Appeal and Accessibility: Revolutionizing the Competitive Arena

o Past: Participant driven sport, long courses, out of sight of spectators, high attrition rate => what fans?

o Today: Stadium Style Racingo Short courses More thrilling and dangerous and faster racingo Multiple spectator viewing areas: Entire course can be seen, with

fleet only yards awayo TV and rescue helicopters fly directly overhead, less than 50 feet

off the water and on the race boat decks o Courses are more challenging and dangerous with the greater

rescue and safety assets committed to the teams

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Results:

o Spectator-friendly venue draws more audienceso Greater viewer excitement in more

competitive, thrilling races o “Apocalypse Now Effect”: Air/Sea Rescue

program is entertainment in and of itself

Broadening the Sport’s Appeal and Accessibility: Media (Television, Radio, Internet, Print)

o Pre APBA Offshore Acquisition: direct satellite television only – 12 million home penetration; no radio; no internet and no official website; small black and white newsletter

o Today: Fox Speed Channel – over 50 million home penetration, over 80 hours of tape delay programming, time buy/barter; live radio at each event; live internet broadcast at each event on APBA Offshore.com; color program at each event, 120 page program for the World Championships

Broadening the Sport’s Appeal: Celebrity Involvement

Pre-APBA acquisition: None

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Today: Teen pop idols Nick Carter and Aaron Carter, NHL All-Star defenseman Derian Hatcher, NASCAR champion Rusty Wallace, up-and-coming pop sensation “No Secrets” with more under negotiation for appearances at the Worlds.

Results to date:

Expansion of the APBA Offshore fan demographic to include a much younger audienceo Cultivating a long term, loyal fan base

Broadening the Sport’s Appeal and Accessibility: Marketing, Advertising, Public Relations and Promotion

Pre-APBA Acquisition – very limited television exposure, no promotion, marketing or advertising of any kind

Today – Aggressive and highly integrated program including public relations, national television, radio, and internet, plus direct mail, print advertising, cable television advertising, telemarketing, signage and billboards, cross promotions and cooperative advertising, brochure distribution plan, newspaper inserts and flyers, government relations (TDC’s and CVB’s) etc. on an event by event basis

Results:

Exponential increase in awareness Phenomenal increase in sponsorships

Pre-APBA Offshore Acquisition – 3 sponsors and $150,000 cash, minimal in-kind

2002 – 100+ sponsors and $3,000,000+ cash and in-kind

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Future projections: $25,000,000+

Broadening the Sport’s Appeal and Accessibiltiy: More Events

Pre-APBA Offshore Acquisition: 6 with only 2 secure, none in major markets or true destinations, and none controlled or owned by Offshore – direct satellite television only

2002: 8 nationally televised Pro Series events, with 12 smaller divisional events

Creating Multiple Channels for Marketing: Innovating Spectator-Friendly Event Sites

VIP and sponsor hospitality tents Closed area grandstands High-quality radio headsets for play-by-play

Results to date:

Gate admissions revenues: $600,000 for 2002 tour to date, with only 4 venues gated – compared with $0 pre-APBA Offshore acquisition Future projections: $10,000,000+ (does not

include VIP) Concessions (Parking, Beverage, Food, etc.): $100,000 for 2002 tour

to date – compared with $0 pre-APBA Offshore acquisition Future projections: $5,500,000+

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Creating Multiple Channels for Marketing: Licensing, Branding and Co-branding

Pre-APBA Offshore Acquisition: None

Today: Developing aggressive plan that includes APBA OS-branded merchandise:

Apparel, die casts and toys, video and online games Product endorsements (“APBA Offshore Race Proven”) Recreational marine products and services (“Certified Racing

Equipment - CRE”)

Creating Multiple Channels for Marketing: Membership Programs

Pre-APBA Offshore acquisition 300 participants; general = 800 Today: 700 participants; general = 1300 The Future: 2000 participants; general = 80,000

APBA Offshore is Positioned for Breakthrough Success

Huge growth opportunity Depth of management Strong business model

Huge Growth Opportunity: Relevant Market

Over 70 million people participated in recreational boating in the United States in 2001

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Over $25Billion spent on new and used boats and equipment in 2001

High level of brand loyalty Upper Income Demographic

Depth of Management: More Than Just a Sanctioning Body

Marketing Public Relations Operations Legal Finance Membership Sponsorships Television Technology Entertainment Celebrities Event Management and Marketing Competition Management Investor Relations

Strong Business Model

Lowest cost operator: “cash cow”:New “stadium” costs = $700 in course buoys AND we onlyhave to buy buoys once every few years!!!!==> Leveraging of higher margins with lower overhead as revenues grow resulting in huge percentage of revenue dropping to bottom line

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Greatest motorsport entertainment value to the spectators, sponsors and participants = low, low ticket prices affordable for the entire family

Vertically integrated marine motorsports entertainment company Event production, management and sales capabilities,

television production and related sales capabilities Participant Membership Program Rules-making and enforcement Competition management. Affinity Membership Program Owns and maintains exclusive control over the licensing, sales

and marketing and production rights to the events, the Pro Series and all related television.

Looking Ahead…

The Future of APBA Offshore: Media

Major Broadcast Networks and Cable, Live Programming, Rights Fees, Pay Per View, Special Features, Movie; APBA Radio Network; live internet streaming video of each event on APBA Offshore.com; Annual Guide to the sport, APBA Offshore Magazine

The Future of APBA Offshore: Celebrity Involvement

APBA Offshore Celebrity Advisory Boardo Led by prominent NY entertainment attorney Steven Beer

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o Comprehensive Celebrity Program to include promotions, special appearances, APBA Offshore product endorsements, enhanced media exposure, broader demographics

o Concerts: 1st major concert to be introduced at the upcoming Key West World Event; “APBA Offshore Rocks” Concert Series

The Future of APBA Offshore: Marketing, Branding, Licensing

Exponential increase in marketing/promotional/advertising programs for each event as well as a series basis, cross promotions and advertising with other “non-competitive” sports and entertainment

Cross marketing potential with non-marine related retailers and consumer products and services

APBA OS branded merchandise opportunities

The Future of APBA Offshore: Beyond Power Boating

Growth + expansion into other areas such as bill fishing tournaments, boat shows and endurance jet craft racing

The Future of APBA Offshore

APBA Offshore becomes the premier marketing vehicle for the marine industry in North America and the Caribbean

5.10 Marketing Plan

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5.10.1 Overview

APBA Offshore intends to use a multi-tiered marketing formula similar to that utilized by several successful motorsports entertainment companies. The purpose of this program will be to produce value for sponsors and members, and revenue and, thus, profits for its investors. The formula consists of the following components:

Event Marketing Television Marketing Local Television, Radio and Print Marketing/Advertising Membership Marketing

The primary difference between this and what the Division has done in the past is that the Company will now be well capitalized and fully staffed to take advantage of the incremental opportunities it has missed because of shortfalls in these areas.

5.10.2 Event Marketing

In addition to the racing, the event marketing model consists of family oriented outdoor charity festivals supporting the race action. These festivals generally include live music concerts, with at least one national level feature act, kids play areas, sponsor exposition areas, boat shows, dry pit and wet pit areas, corporate hospitality, fireworks shows and "Tastes" featuring the local area's finest restaurants. The model is designed to safely attract the most number of fans as possible in a concentrated area to maximize sponsor exposure. Revenue is generated through national, divisional and local sponsorships, as well as admission charges, and sales of food, beverage and retail merchandise like t-shirts, hats, replicas and pins. The model also emphasizes creating a first class event for the racers and their families while treating volunteers as the most valued assets of the organization. All Offshore events will have the same basic look and feel with the Pro Tour Series events larger and more national in scale than the Divisional Tour events.

5.10.3 Television Marketing

The television marketing model consists of televised broadcasts of the racing action on TNN and Speedvision. The TNN shows will feature the Super Boats and Factory Boats from Pro Tour events, while the Divisional races including the Outlaw boats will be carried on Speedvision. The shows will depart from the traditional "as if live" coverage model usually accorded boat racing events. Instead these shows will employ a hipper style featuring music, story telling and character development as well as highlights of the best racing action for that event. Revenues from the shows will be generated through the sale of entitlements and straight media advertising.

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5.10.4 Local Television, Radio, and Print Marketing/Advertising

With its staffing and capitalization needs met, the Company now also will be able to promote its events more thoroughly on a local level through local and divisional television, newspaper and radio advertising. The plan also is to work with Cox Enterprises to implement a more comprehensive national media plan similar to that used for the World Championships. Here the Division works with several Cox owned radio stations to sell local and divisional sponsorships and lever those stations' relationships with other media outlets to thoroughly promote the event and all of its corresponding activities, as well as the chosen local charity. Of course the Company intends to thoroughly develop and strengthen its relationships with industry media such as Powerboat, Hot Boat, Boating, and Raceboat International, as well as other national non-traditional media outlets.

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