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Transdigital Network Systems Business Summary
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This document is supplied by Transdigital Communications Corporation ("TCC") with regard to the financing and (2) Transdigital four major lines line of digital players, servers and Network ("TTN"), development of itsAirline Products' of business: (1) The Transportation interactive systems, (3)AirWorks' maintenance and installation business and (4)Transtar Cruise Line Systems.required to make does not purport to be on any potential investment all the information This document an informed decision all-inclusive, or to contain in TCC. No representation or warranty is made as to the accuracy, reliability or completeness of any of the information representation as toNothingevents. Recipients document is, or should be relied on as, a promise or contained herein. future contained in this of this document understand and agree that all information contained herein is of a HIGHLY CONFIDENTIAL and PROPRIETARY nature, and that they will treat this document in a completely confidential manner. All recipients of this document agree that they will disclose information herein only to their agents or advisors, and then only to evaluate TCC, and that they will not disclose, nor permit their agents or advisors any any party any any reason to disclose, information contained herein to third at time for without the prior written consent of TCC. This Business Plan is the property of Transdigital Communications Corporation. Information contained herein may be protected under US and/or international copyrights.
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sell, or solicitation of an its delivery any securities or investor, shall constitute an offer to Neither athis document, nor offer to buy, to any prospectiveassets of Transdigital Communications Corporation.
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Contents Table of
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I I I. Summary A. B. C. I D. E. II. Mission Statement TCC Proposed Financing
Table of Contents
Summary Financial Information Analysis of Financials and Projections
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Business A. Company History Markets Products Competition Manufacturing Distribution and Marketing Patents and Proprietary Technology Strategic Partners Regulatory Aspects Research and Development Pricing and Margins Facilities
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B. C. D. E. F. H. G. I. K. J. L. III.
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Management
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A. Executive Officers Risk Factors Exhibits A. B. C. Projections List of References Current Shareholders Product Brochures/Aircraft Antenna Pictures Block Diagrams: Shipboard and Airborne Systems
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Summary
A. Mission Statement
The mission of Transdigital Communications Corporation ("TCC") is to capitalize on the enormous growth in demand by consumers within the airline, cruise line and other transportation market management team with 70+ years of aggregate experienceand information data bases. TCC's segments for continuous access to on-line entertainment building integrated communications products and support systems for the airline market has developed a range of products and services that meet this rapidly growing consumer demand. These products include: a real time satellite broadcast network for airlines and cruise lines; a proprietary line of digital servers with large storage capacity configured for aircraft operation; a coax based digital system interactive for cruise ships and a proprietary, software based, automated maintenance diagnostic system that provides advance warning of system service problems for aircraft. B. TCC Companies developed and operated by TCC's management team have led the in-flight entertainment ("IFE") and communication industry competition, 30 years. Theform TCC to in identifying market opportunities in advance of the for the last led them to team's skill capitalize on five emerging trends in the transportation markets: 1. The demand for narrowbody aircraft worldwide is growing faster than for widebodies and the airlines are increasing their purchases of IFE equipment for narrowbody aircraft. (This has been cutbacks and by by Boeing's recent announcement regarding widebody confirmed both British Airways recent announcement on a large purchase of narrowbodies from AirBus - see attached articles). Competition between carriers to bring live TV broadcasts and new communication services to these aircraft is becoming intense as airlines view these features as critical elements in their battle for market share. The explosive growth of the Interact has resulted in a constant demand for individuals are on an aircraft or cruise ship, their by consumers. line access to immediate access to vast libraries of information appetite for on- When entertainment and information increases substantially. The industry is increasingly looking at file servers to replace capacity limited tape and CD players to meet this demand. ,
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a major problem quantities of media and data on aircraft economically has become Delivering large for the carriers and their suppliers. Manual loading of large media files onto servers has proven to be both labor intensive and logistically difficult given the short period of time that aircraft are at the gate.
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As airline entertainment and information systems increase in complexity, maintenance has become a major concem. With not manage the repair of airline maintenance organizations are finding they can rapid turnaround times, current
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IFE systems that currently involve more that 400 networked computers and 2000 information of a The need to prior ground arrival is becoming critical. separate modules.system's statusprovide to aircraftrepair centers with advance
Equally critical to maintaining systems is the today, to do are requiring installation. In the competitive environment airlines face need they rapid system that full system installation be done on overnight holds as much as possible and they are looking to third party contractors to take on this responsibility.
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TCC has organized itself into four business units to exploit these opportunities. I I I. The Transportation Network ("Transnet" or "TTN,). This business unit will provide, via satellite, real time broadcast of news and sports nationwide to the system airlines' short haul, narrowbody fleet, as well as to cruise ships. The is paid for advertising revenues which the airlines and cruise lines will share. Transnet is in negotiations with major media providers, including Fox and NBC to license their programming for broadcast to the airlines. Transnet will insert its advertising into the programming, uplink the feed from a ground station, (operated satellite, (most likely one operated by GE of Burbank), to geostationary in partnership with Four Media, Company Americom). The afeed will then be broadcast simultaneously to receivers installed on Transnet's subscriber airlines and cruise lines. The Transportation Network's coverage will include 1000 commercial aircraft and 20 cruise ships by the end of 2001 (this represents a total viewingtracking of approximately 240,000,000 passengers annually). TCC's low cost, market antenna system is currently installed on 486 aircraft operated by United, Delta and Northwest Airlines. Both United Airlines and American have asked TCC to quote the Transnet system for installation on their narrowbodies. Airline passenger surveys have consistently identified frequent business travelers' strong interest in the type of real-time news sports and current market information provided by Transnet broadcast service. In addition to generating advertising revenue, Transnet the onboard filepaid subscription service for the transmission of media and data to will provide a servers. II. Transdigital Airline Products. is the aircraft hardware and software development arm specializing in the design of advanced products. This unit will provide the onboard video and audio servers to the airlines that will enable them to store significant libraries of information on the aircraft. The products include: the AudioFile (9GB HDD) which functions as a broadcast audio player or as an onvideo server and as VideoFile (9GB HDD) which flight as a single channel demand server; the an automated flight manager ofserves programming. TCC intends to use the Transnet satellite service ultimately to load media onto these servers.
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The other primary server-based product is the Cabin Operations Manager (COM) can download media itself and controls when safety messages and programs are (1.5GB HDD) which serves as the entertainment system control unit. The COM played throughout the flight. The COM also plays a critical role as communications systems, for Maintenance Alert. This proprietary on-board polls cabin electronic director captures all faults or failures and via an software modem, relays the information ahead to ground based maintenance computer which prints a units to workorder. When the aircraft lands the mechanic knows exactly which repair work on. The Company is also developing a hydraulic retractor unit that is used on narrowbody aircraft to raise and lower the 6.5" LCD viewing screen from underneath bag bins. The unit is designed to handle up 14" displays and is far cheaper and more reliable than any unit currently in service. As an example of the airlines strong interest in this technology and software,
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American Airlines has asked TCC and its partner Matsushita Avionics Systems ("MAS") to quote the entire package ofAudioFile, VideoFile, COM, hydraulic retractor and Maintenance Alert for 260 MD-80 aircraft, a contract which will be valued at over $100 million.
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version of the currently unit and with Monarch Airlines behalf of Gulfstream) The Company VideoFile has orderswith Pacific Systems (on for the AERIS FX for the AudioFUe unit. III. AirWorks ("A W") (46% controlled by TCC) has completed in excess of 1000 overnight installations of telephone systems on aircraft. AirWorks will be responsible for all on-board engineering, installation servers and other of the Transnetcompany and receiver hardware as well as TCC's and certification products. The antenna will also supply technical ground support and maintenance for Transnet equipment and Alert system.. TCC's servers and will interface directly with the Maintenance TCC has the right to acquire 51%, or more, ofAirWorks. This Plan assumes that acquisition is completed in July and the AirWorks results are consolidated thereafter with TCC's. Transtar Cruise Line Systems has developed Transtar, which is targeted at the cruise lines, will be among the first fully digital interactive entertainment and communication systems operating in the world This system is currently undergoing trials on the Sun Princess. Passenger response to the system has been with the positive and Princess technical partners in the development of ships extremelysystem.. Transdigital's is considering installing up 12 additional this system are General Instrument and Vivid Technology.
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C. I I Proposed Financing To implement its Business Plan, TCC intends to raise $15 million in a private placement in two stages. The first stage will be in the form of a $3.0 million bridge financing to complete the development of the be used toand TTN's infrastructure implement Maintenance Alert. Network of the funding will servers, build the receiver and to support The Transportation The balance and to support working capital requirements at Transdigital Airline Products and AirWorks.
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Summary
Financial
Information
Set forth below are the projected consolidated statements of operations for TCC for the calendar years 1998, 1999 and 2000. Transdigital Communications Corporation (000's) Fin a n cia ! S u m m a ry
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Transdigital Airline Product Net Revenues AirWorks Revenues Transtar Cruise Line Revenues TTNNet Revenues Total Revenues Total Gross Margin Total Operating Costs
1998 $332.7 $9,252.9
1999 $12,711.7 $12,368.7 $4,513.5 $13,363.1
2000 $22,414.2 $13,738.3 $10,310.8 $49,120.4 $95,583.7 $67,107.1 $25,562.5 $41,544.6
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$9,585.6 $2,299.3 $8,080.6 ($5,781.3) Projections
$42,957.0 $23,426.3 $17,471.7 $5,954.5
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Total EBITDA E. Analysis of Financial
The following analysis looks at the financial performance, projected for TCC's four operating divisions: TTN, Airline Products, Transtar and AirWorks. • TTN
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TTN anticipates rapid equipped with the Company's tracking antenna and increasing numbers of aircraft are growth in advertising revenues from 1999 to 2000 asreceiver systems. By 2001 the Company anticipates having 1000 aircraft installed and receiving the live broadcast signal with total annual viewers approaching 220 million. The Company has estimated that the initial ads sold will be on the basis of approximately $12 June 1998 Page 4 Proprietary Information
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per thousand viewers ($12 CPM). As The Transportation Network grows, rates are hours per day and selling an average CPM. 30 second spots per hour. The broadcasts expected to increase in excess of $15 of 30 x By 2000 TTN anticipates broadcasting 20 should be averaging 45,000 viewers per spot with each spot selling for $675/spot, or an equivalent CPM of $15 [ ($675.00/(45,000/1,000)) = $15.00]. Advertisers feel the demographics of the frequent business traveler market are extremely attractive, and Transnet offers advertisers a completely new way to reach that group. By the year 2001 gross million. $100 ad revenues (before sales commissions and airline revenue sharing) will approach
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It should be noted that competitive media in the airline market such as seatback magazines and in-airport television broadcasts average $20-$25 CPM. Transnet's numbers thus have significant upward potential beyond the $12 used in this financial plan.(See Section J) The margins in Transnet's business are very strong once the ground station infrastructure
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is in place and the satellite and programming contracts are arranged. The Company at that point has only fixed costs apart from selling commissions for the ads (17.5% of gross significant; each payments ad of gross revenues). The Company's Gross Margins sales) and airline incremental(5% dollar (net of commissions) increases operating leverage is commensurately. • Transdigital Airline Products
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This business unit's earlier as well as the retract are derived from the Maintenanceserver products described major sources of revenues mechanism and the sale of the Alert and MedAlert proprietary software packages (MedAlert is a medical emergency software user's guide for use on the event of medical emergency in-flight.withpassenger's medical instructions stored in the COM and provides flight attendants A graphical vital signs can be monitored and passed via the COM to ground medical staff. American Airlines' medical are narrowbody aircraft: MD-80's, in this software). The Company's others. There market staff has expressed keen interest B737's, A-320's, B757's, among primary target are approximately 3,200 narrowbody currently operated by the major domestic carders aircraft that could be installed with that number expected to increase at least 25% over the next 5 years. AudioFile, configuration VideoFile, COM , A typical narrowbody will include lx Ix lx 20 to 30 retract mechanisms and the Maintenance Alert and MedAlert software packages. The value of the entire package is approximately $90,000 per aircraft exclusive of license fees or Maintenance Alert transaction fees. Many narrowbodies will have more than one server installed so the Airline Product unit's target market approaches $500 use of Maintenance Alert Products @ $.05 per 500Byte on a per transaction basis million. In addition Airline (estimated intends to bill airlinesmessage unit). Hardware for product margins will average 40% of gross revenues. In the Plan, Airline Products revenues grow from $12.7 million in 1999 to $22.4 million
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in 2000 as the Company achieves significantly greater market penetration. Of the year I from revenue sales. 2000 hardware total, 15% derives from Maintenance Alert transaction billings and 85% I • AirWorks Since its formation in 1994 AirWorks has focused on providing the airlines with a low I cost, turnkey solution for the engineering, fabrication, installation, certification of entertainment and communication equipment on commercial aircraft. Most of these installations are accomplished at the airport terminals during the aircraft's overnight no layover requiring out of service time for the installation. The A W Business Plan has been, and continues to be, structured on the premise that I AirWorks can accomplish complex installations faster and at costs lower than any other company in the industry. A W recognized that there would be a ramp-up and then drop off in its telephone installation work for AT&T as all of the aircraft became equipped. Prior to this requiring decrease, A W directed its marketing efforts toward new business opportunities anticipatedequipment installation, assembly of system cables and kits, and FAA certification support. Among the new opportunities which surfaced were total audio/ video system installationfor laptop W could performthe installation aircraft holds, assembly of in-seat power cables which A computers, and on overnight and certification of satellite antenna systems for use by the airlines for live broadcast of media and data. By the year 2000, AirWorks will be generating $13.7 million in annual revenues with 10% from engineering services, 63% from manufacturing kits, cables and trays and 27% from maintenance, modification and installations. AirWorks in 1997 achieved revenues of approximately $6.5 million without any lIFEmaintenance business. average Overall, the gross margins for AirWorks should 25% to 30% of sales which will be somewhat less than TTN and Airline Products. The service/installation part of the airline industry has tended to be far more: price competitive than is the case for the other two business units.
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Major customers include American Airlines, Northwest, AT&T among others. Transtar Cruise Line Systems
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I Cruise Line Systems major product line use by passengers in their staterooms. The system system which is sold to cruise lines for will be the Transtar digital interactive video will allow passengers to watch movies ola demand, order shore tours, gamble and even process digital $1,000,000 per during the 1000 room ship. This system employs General $800,000 and pictures taken ship for a cruise. The system will be priced between N
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Instrument's newest fully digital set top box, the DCT 1000 in conjunction with a series of Vivid Technology's software and provides onboard serviceSystems also a price of interactive application streaming video servers. Cruise Line support for licenses the $17.50 per installed set top box per month. Hardware margins for Transtar should average 35% of unit sell prices.
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Transdigital was formed in 1994 by Richard A. Bertagna and the team of executives that founded and in 1994 byHughes-Avicom, an leader in the in-flight entertainment of experience in the was formed managed Ricky D. Frick, a executive with more than 20 years business. AirWorks airline maintenance industry with Boeing, DalFort Aviation and America West Airlines. In 1997 Mr. Bertagna recognized the benefits of combining the separate but closely linked capabilities of TCC, including its airline and cruise line businesses, with AirWorks and later added TTN to provide a tumkey entertainment hardware, software and service organization for the serve as transportation markets. Mr. Bertagna will Chairman and CEO of TCC which will be headquartered in Brea, CA. Organizational Structure
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TCC is organized around four distinct functional activities: (1) Management of media programming and advertising sales (2) Management of the ground uplink transmission of programming and data to aircraft and cruise ships Development of products and services that deal with communication and entertainment challenges facing the airlines and cruise lines Worldwide service network positioned and staffed to maintain the sophisticated systems which are being installed on commercial aircraft and ships
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The operating management, media programming and advertising personnel and engineering personnel are headquartered in TCC's Brea, California, facility. AirWorks which specializes in the installation, certification and after sale maintenance support of installed systems, is headquartered in Irvine, California. TCC elects to out-source its manufacturing to companies which are FAA certified to manufacture and ship electronic products. Out-sourcing eliminates manufacturing. the overhead costs associated with low volume The combined efforts of TCC and A W are focused on developing cost effective solutions for the
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operators of high technology communication and entertainment systems in the transportation industries. The simple fact is that the technical complexity of these interactive systems, coupled and logistical problems for the airlines. large libraries on media files, results in major operational with the continuous demand to update
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Historical had combined operations in 1995 and and are Statements, below: companies Financials - Historical pro-forma Profit 1996,Loss summarized prepared as though the
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TCC Pro-Forma Financials (000's)
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Transdigital Revenues AirWorksRevenues TotalCombinedRevenues GrossMargin Operating Costs
1995 $925.4 $7,550.3 $8,475.7 $1,407.6 $1,728.3 _qgo 7)
1996 $489.5 $8,949.8 $9,439.3 $4,542.5 $5,999.6 (,,_l,A_7 1_
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There were no sales in 1996 and 1997 for Transnet or for Cruise Line Systems I Transdigital in 1996 and 1997 carded out research and development work on its line of server products, with particular emphasis on Transtar and the system's interactive software. AirWorks has grown from a start-up business to generating over $9.0 million in revenues in less than two years. AirWorks won a major contract in 1996 from AT&T for the installation of phone aircraft 1 had 000 systems on and, through year-end 996, completed over 1 installations, all of them during a plane's overnight stay at an airport. B. Markets
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cruise two Some markets are the commercial each industry, set forth executive jets, and the TCC's lines.primary of the major characteristics ofairline market are including below.
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Airline Market The primary customers for TCC's products are the major international and domestic
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airlines personal video displays, and in-seat interactive video and audio systems. Included in-seat that offer passengers in-flight entertainment (IFE) options including overhead and with these major carriers are the operators of larger corporate jets - the so called "big iron" aircraft-like the Gulfstream 4 and 5. Over the last few years both the airlines and the large corporate operators have significantly increased their investments in new aircraft and have been upgrading existing aircraft for additional years of service. This has resulted use as a means equipment in a period of massive investment in IFE which the airlines of differentiating their inflight product. In this market TCC estimates there are over 3,000 widebody aircraft operating worldwide and 4,000 domestic narrowbody aircraft operated by the major carriers that are going to be newly outfitted or upgraded with improved IFE video or audio systems in the next five years. There are approximately 1,000 corporate aircraft that will also receive technologically more advanced systems. A major problem faced by these carriers is that the systems installed to date are based on analog technology which limits the amount of programming that can be offered and June 1998 Page 9 Proprietary Information
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severely restricts the range of interactive features that are available. The systems are built around tape players which require the processing and handling of video and audio cassettes. These are cumbersome, expensive and the airlines want to find alternatives. The airlines have also found that the interactive systems offered by the major IFE suppliers require a high degree of maintenance and support which is critical if the systems used for are being revenue generation.
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by other major their enormous complexity with regard that has often been overlooked Thethe airlines, isproblem with on-board IFE systems, oneto ongoing maintenance and support. A single data communication fault in a 2,000 module system can render the aircraft turn-time is When this occurs, system inoperative. virtually impossible.locating and correcting the fault during a one-hour Failure to correct inbound faults oftentimes results in several days of continued passenger dissatisfaction and lost revenue. TCC's Maintenance Alert addresses the fault detection problem with its Ethernet polling system which scans all of the system modules, collects reported failures from each module, and forwards the information to the ground an indication aircraft's has failedThe diagnostic software can provide the repairman with ahead of the of what arrival. prior to his visit to the aircraft. Until now this invaluable service has not been available to the airlines. With its collective 70+ years experience in the IFE industry, TCC has assembled a group
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of operating companies that have the products, services and maintenance capabilities that precisely match the airlines' IFE needs today. • Cruise Line Market The cruise line business in the United States is dominated by the following six large
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companies that together will be operating approximately 47,000 staterooms during the next five years: Carnival - Over 10,000 staterooms existing, plus another 4,000 on order Princess - Approximately 5,500 existing staterooms and 4,200 on order Kloster - 5,600 - 5,000 existing staterooms and 3,500 Royal Caribbeanexisting staterooms and 200 on order on order Costa - 3,100 existing staterooms and 1,100 on order Celebrity - 1,900 existing staterooms and 2,600 on order
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I 16,000
Top Six North American Cruise Lines (Stateroom Totals)
Legend
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14,000 12,000
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Carnival Costa 46,994 Staterooms Association; Business
Kloster Week, May
Celebrity 1, 1995)
Line
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The major cruise ship operators are consolidating their positions with a construction program for new and more elaborate vessels that is unprecedented in this century. The combined shipbuilding program for the major cruise lines totals over $5.5 billion for the construction of 19 new ships by 1999. Along with adding staterooms to their inventory, there is currently a major effort to upgrade the quality of the experience while on the cruise. Currently, most ships have offered their passengers a very basic cable TV service in the room, perhaps utilizing 10 channels, and with a heavy emphasis on movies. Few, if any, passenger services are available through the total channels could exceed 900 (if so desired by the cruise lines). digital interactive the cruise system. By adding new technologies like Transdigital's Transtar This would enable television, line operators to offer entertainment and information services that are widely talked about, but scarcely available elsewhere. A fully interactive digital video system may cost between $.8 - $1.0 million; a new ship may cost as much as $300 million. benefits achieved costadvertising and when weighed against more dollars and against the perceived The incremental in of the system, promotion (where far a ship's cost are expended), is relatively insignificant. The economics of a system investment are further improved by the system'scruise line following significant incremental revenue. if( all services arean TCC projects 18-month payback for a ability to generate a Transtar system investment, offered).
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C.
Products
Airline Products and Services - Set forth below are the major products and services offered by TCC's operating subsidiaries: (See Section J, Pricing and Margins.) • TTN
as previously Network 's The group's primary service described is The Transportation real-time broadcast of entertainment and information to domestic narrow body aircraft. With its upgraded antenna TTN has the capability of picking up two live broadcast
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channels (with the overhead video system the passenger has no choice over which video is displayed.) The service will also include two channels of live radio broadcasts as well to a flight data channel which will packet - not included in the operational parameters as the carriers (at a fixed charge perprovide data packets on flightfinancial projections). Transnet will contract the day-to-day management of the ground uplink facility to Four Media, a company operating twenty-four hours a day seven days per week. Advertising on the system will be sold by a third party sales organization on commissionprojected at 17.5% ofboth well sales dollars firms in airline ad sales). A KuTV and Airline Advertising Bureau, total ad established (TCC is negotiating with Sky band transponder will be leased by TTN from one of the major satellite operators, most likely GE or Loral. ," Transdigital Airline Products The VideoFile is a modular digital video player that can be configured to have from 8 to 32 simultaneous and independent video playback outputs and is targeted as a on approximately currently videocassette player (VCP) replacement for all VCPs installed 3,000 existing aircraft. The VideoFile uses hard disks and MPEG digital compression technology to store and playback video programming. The unit also provides the airline with the ability to automate the presentation of video programming, including movies.
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passengers is a version of the VideoFile which provides a moving map display to AERIS FX illustrating an aircraft's progress with data updates on ETA, temperature, speed, etc. The unit can store and playback up to twelve (12) hours of MPEG digital passenger safety briefings, frequent flier promotions, destination programs, customs video programming with full and instantaneous random access. This may include and immigration information, etc. -- each presented in the appropriate languages for the particular flight. The AudioFile digital audio player allows an airline (or cruise ship) to provide up to 144
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hours of CD this unit,stereo audio will have complete is stored on control gigabyte audio disk drive. With quality the airline programming that automated one 9 over its hard programming. The system greatly increases the capacity for storage of audio programming and loading and practical with CD's or cassettes and eliminates all reproduction beyond what is unloading costs associated with those media. The AudioFile Audio On Demand (AOD) System offers substantial marketing advantages
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to airlines that want to provide high-end audio on demand service to their premium passengers. AudioFileaccess to approximately 200 music service up to 13 passengers are AOD System can simultaneously with instantaneous albums or audio books that digitally stored on the AudioFile's internal hard disk. Up to 144 hours of MPEG compressed stereo audio programming can be stored.
The COM provides the user control interface to any or all of the Transdigital avionics I products that are installed on an aircraft. These products include the AudioFile, FideoFile, AERIS FX and the satellite signal receiver. In addition, the COM performs hard drive(s) of the Transdigital digital multimedia its internalinstalled on the aircraft. the automatic download of digital media files from products CD-ROM/DVD to the This media download is accomplished via an Ethernet 10baseT link to each of Transdigital's products for which the COM is the local area network (LAN) hub. The COM, through its MAINTENANCE ALERT system, continuously polls all electronic modules on thethat information toimportant informationaircraft's telephone. and, while in-flight, transmits aircraft, captures the ground over the from each module This advance warning, in the case of a system malfunction, informs the technician of the repair action required well ahead of the aircraft's arrival. The interrelationship between TCC's satellite broadcast network and its digital products I • I I is diagramed in Exhibit F. AirWorks AirWorks ties TCC's operations together by virtue of their installation, certification and maintenance capabilities. A irWorks will: (1) perform contract engineering and manufacture trays and installation kits to support TCC's airline products and the products of other vendors, (2) perform the actual certification and installation of the unit or system on an aircraft, and (3) in the near future provide complete line maintenance on the IFE units and systems of TCC and for third parties.
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maintenance agreement with product support organization, A W suppliers. to secure To cost effectively launch theone or more of the major equipment will attempt A target a customer is Sony-Transcom who have not yet developed a full maintenance support organization.WInitial conversations have certainopened with Sony-Transcom's regarding A providing this service at been key locations. president
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Transdigital's Cruise Line Products and Services I I Transdigital's primary product for the cruise lines is Transtar, the cruise industry's only fully digital interactive in-room video system. The product has been designed around the latest coax cable distribution technology enhanced to accommodate specific requirements for the cruise ships (see Exhibit F - I'ranstar Architecture and Block Diagrams). The system will offer to guests via their in-room TV system movies and audio on demand, gaming, shore tour selections, wine selections, catalogue and duty free shopping, digital
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photograph selection and a range of other interactive services. It is Transdigital's intent I to purchase the into antechnologically advanced system components Transdigitars and integrate them most interactive system. This system will feature from suppliers proprietary operating system and application software developed by TCC engineers over the last two years. The management team has learned from its experience with the airlines that the key to I generating revenue from any interactive platform lies in (1) the user friendliness of the application software which ensures passenger comfort with the system, and (2) the network bandwidth and transaction speed that generates the maximum number of transactions at the lowest Transtar possible cost. Transdigitars system encompasses the hardware and software necessary to accomplish these objectives. D. Competition I
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Satellite Direct Broadcast Services The major competition in the live broadcast to aircraft market is focused on developing
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systems for in-seatformerly Hughes-Avicom) and the BE Aerospace/Harris venture are Systems (RCPS - video equipment on widebody aircraft. Rockwell Collins Passenger using very large and expensive ($200k/aircraft) panel array antennas designed to pick up a multi-channel DBS signal. There are, however, some major differences between TTN's service and the RCPS and
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BE service. RCPS intends to charge for both the programming and the installed antenna and receiver system. To effectively view the DBS multiple channels, the aircraft must be equipped with an expensive in-seat video system which will allow the passenger to select a channel of their choice. To the recover equipment costs, weight penalties and multichannel programming costs, the airline or passenger must pay a $2 to $4 viewing fee. This has been unattractive to most airlines, as the business model does not demonstrate a return on investment.
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extract, for example, reports ofwith DBS, the airlineadvertising to edit its programming to A further disadvantage is that, aircraft disasters or is unable for a competitive airline. This is easily done by Transnet at its ground uplink station. Transnet's antenna, which has two channel capability, costs approximately $20,000, and it will be provided along with programming at no charge to the airline. Advertising revenuesa from 30x30 second spots investment per hour, generate ample revenues to achieve very attractive retum on broadcast for Transnet and the airline.
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Airline Entertainment Market The airline entertainment market is served by essentially four major suppliers who focus
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on selling large integrated, interactive systems for installation on widebody aircraft. These suppliers include RCPS, Matsushita Avionics, BE Aerospace and Sony-Transcom. Transdigital does not attempt to compete directly with these companies, but rather has identified niches where it value added can provide high products that are not part of the
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larger companies' main product lines. Alternatively, in the the case of American TCC I has elected to team with Matsushita. Transdigital competes with AirShow, Inc. in the moving map display market. AirShow has been a dominant supplier of map displays in the business jet market and on EPROM acceptance on commercial airlines. Their core product architecture is based has wide technology which offers less flexibility than Transdigital's hard disk drive server architecture. In addition, their system is almost twice as expensive as Transdigital's. AirShow has recently introduced a new product which stores additional programming on compact disks. This product will overcome many of the shortcomings of their earlier products. • Aircraft Installation Services Currently, AirWorks faces one major competitor in the overnight installation business: installation Aerospace. Hollingsead has tended to focus essentially disappeared since Hollingsead kits. Their overnight installation business has more on manufacturing trays and the emergence of AirWorks in this market. In the IFE maintenance market the major competitor, and perhaps only quality full service maintenance organization in the airline industry, is the Service and Support Group within Hughes-Avicom. This organization was originally Division by Bell& Howell. Thein 1967 as Director of Operations for the Airline Products founded of Richard Bertagna AirWorks strategic plan is to enter the full service maintenance arena, while avoiding an over extension ofneed for a and financial resources. There is no question that the airline market is in dire technical second qualified full service provider. • Cruise Line Market Transtar has two competitor in the cruise line interactive entertainment market. One, I Sea Vision, a subsidiary of Allin Communication has installed their analog distribution system on several ships including ones owned by Royal Caribbean and Carnival. The Sea Vision business model provides the interactive system at no cost to the ship owner in revenue revenues generated exchange for the advertising and certain shared point-of-sales by the system. Their system has experienced several predictable technical and guest service problems resulting from limitations of their analog system and the ship's environment. To adequately accommodate Sea Vision's interactive service on a eight hundred room ship, the ship must be divided into four or five zones. Each zone requires a many space consuming head-end. The ship's performance cable plant. costly,ships by the poor condition of the system existing coax is further compromised on I • I
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ships and Carnival asked announced to quote on 5 ships. Recently Royal CaribbeanTCC in June that it was removing the Sea Vision system from its
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The other competitor, The Network Connection, has started installation on two Star Cruises ships with their analogue based system. Transdigital's management anticipated the technical and guest service problems resulting June 1998 Page 15 Proprietary Information
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from the analogue system architecture and decided to take the lead by developing a fully digital system. Digital technology's advantages over analog in a ship's coax environment include: (1) Digital technology allows the modulation of 12 digital channels in the bandwidth of a single analog channel. The total number of analog channels on a quality coax cable plant is typically 80. On this same coax system, Transdigital would be able to provide 960 channels. (2) A second and related issue is the condition of the coax cable plant. As ships operate in a corrosive environment, the cable plant is often found not to be in the best of condition. RF analog distribution depends on the quality of the coax cable system -the poorer the cable plant, the fewer analog channels. Digital technology is far less susceptible to the condition of the coax cable. The end result is that the Company's digital system will require a single head-end, whereas an analog system could require as many as five head-ends to service the same number of rooms on a ship, thus adding cost and consuming space in the ship's electronics room. E. Manufacturing
TCC's products are designed to comply with aircraft and shipboard specifications. The manufacturing of these products must also comply with certain industry and government regulations. To control manufacturing and overhead costs, TCC has elected to out-source the assembly and testing of its products to companies that have proven experience and are appropriately licensed to operate in TCC's markets. One of these companies is AirWorks, which will manufacture certain, electronic tray assemblies and cables harnesses for TCC and Transnet. AirWorks will interface with other manufacturing companies contracted by Transnet and Transdigital to ensure that products meet FAA certification requirements. An important consideration in TCC's design and development of products for the airline and cruise line markets is that the units incorporate commercial off-the-shelf technology (COTS). TCC does not intend to develop products that require a great deal of customboard work or that require the design or development of new chips or circuits. In this way the Company believes it can remain cost competitive with its competitors.
F.
Distribution
and Marketing
Transdigital, TTN and AirWorks currently market their products and services with direct marketing staffs supported in specific markets and geographic areas by industry recognized sales representatives. In addition to their direct sales staff and representative network, certain products are supported by the sales staff of strategic partners such as General Instrument and Vivid Technology. Vivid provides the media server and head-end switching module for the Transtar cruise line digital interactive system. GI makes the digital set top box incorporating QAM 64 modulation for upstream and downstream communications.
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As noted, TTN advertising will be sold through third parties on a commission basis. I G. Strategic Partners and Key Relationships I • Vivid Technology has teamed with Transdigital Communications as the supplier of the media file server and head-end switching electronics for Transtar. General Instrument has worked closely with Transdigital Communications in the development of a digital set-top for the cruise lines. TCC has a Letter of Intent with NBC for the United quote and has held extensive programming issues and they remain very interested in the TTN program. discussions recently with Fox Broadcasting on a number of technical and
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TCC also of a Letter facility with Four at that company's large facility there. operation hasan uplink of Intent in Burbank Media about the establishment and
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electronics. Signal Engineering will be developer and manufacturer of the TTN video receiver
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Rantec provides the antenna and antenna satellite tracking electronics for the Transnet system. Toronto MicroElectronics will be the developer and manufacturer of the COM unit Fluid Source is the developer and manufacturer of the hydraulic retractor and Proprietary Technology
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H.
Patents
Transdigital has several proprietary products which are described in the Product Section. A more detailed understanding of these products is available upon request in the form of product sheets or descriptive technical documents. Transdigital also holds a patent for wireless distribution of compressed media and data over a compressed data packets from The network providestoan automated located onboard aircraft. local area network at airports. a central transmitter file servers electronic means to transmit Updating data files over the network automatically reduces the airlines' costs. The Company has
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not included this system in its current financial projections. TTN and Maintenance Alert and MedAlert are trademarks. No other IFE vendor offers any kind
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of fault polling software that in any way is equivalent to MaintenanceWith thisIts unique features Alert. software TCC, is are already being recognized by the airlines, in particular American. in a position to establish the industry standard for BITE (Built-In-Test and Evaluation) on to aircraft. MedAlert, likewise is a unique product, which is becoming of increasing importance the airlines as the rate of in-flight medical emergencies continues to increase for. A patent for the COM has been applied June 1998 Page 17 Proprietary Information
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i June 1998 Page 18 Proprietary Information
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I. I I Regulatory Aspects Many of Transdigital's products are designed for aircraft. As such, they must comply with the requirements established by the Federal Aviation Authority (FAA) and other foreign agencies similar to the quality addition manufacturers' FAA. In standards.to the FAA, products must comply with the airframe Satellite and wireless transmission technology and broadcasts are regulated by the FCC in the United States and similar organizations in other countries. J. Pricing and Margins
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The first Table second Table compares prices and margins to other media in the airline passenger products. The below summarizes the Transnet's pricing for Transdigital's and AirWorks' market. Transd_ital Product AERIS FX and AirWorks Unit Prices and Margins Product Unit Price $23,180 $18,300 Gross Margin 40% 40%
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AudioFile
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VideoFile Transtar AirWorks Installation Kit
$20,000 $800,000 $14,500 (average unit) TTN Competitive Media Pricin_
40% 35% 25%
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CPM Rates
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Media Seat- Back Magazines United Hemisphere Delta Sky Northwest World Traveler Broadcast Services
CPM
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$30.00 $25.00 $26.00
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CNN (In-airport service) Transnet Live Broadcast
$20.00 $10.00 -$15.00
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K. I I Research and Development A significant factor in TCC's management's success in the IFE market has been the continuous stream of new products they have brought to the market place over the last 30 years. Richard Bertagna, President of TCC, in fact received the World Aviation Entertainment Association's Lifetime Achievement award for innovation and leadership in this market. This tradition of invention has continued with the hydraulic retractor. L. Facilities COM, MedAlert and the Maintenance Alert,
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The divisions may be prudent toare at the present timeand Transdigital different facilities.Orange progresses, it comprising TCC co-locate AirWorks located in two (both located in As time County, Califomia) into a single facility. TTN, Transdigital Airline Products, and Transtar Cruise Line Systemsatare is co-located with TCC in Brea. service providerground station will be located in Burbank facilities operated by Four Media The Transnet to Hollywood studios.
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Entity. I i TCC AirWorks Square Footage 10,835 12,795
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I A. Executive Officers I
Management
Richard andBertagna,Chairman of Hughes-Avicom Intemational, a company that has been the founder A. former Founder and CEO Transdigital Communications - Mr. Bertagna is the leader in in-flight entertainment systems for the world's airlines for the last 30 years. Mr. Bertagnaprovider Avicom in 1982 and grew it from $2.5 million provider of an early retirement million started of integrated audio and video systems. Mr. Bertagna took headsets to a $100 from Hughes in 1994 to start Bertagna & Associates. In September 1994, Bertagna & Associates merged with Creative Engineering Unlimited to form Transdigital Communications Corporation. In September 1996, Mr. Bertagna was honored for his contributions to the airline industry by being awarded the industry's first World Airline Entertainment Association's Lifetime Achievement Award. Rick3, D. Frick, Founder, Chairman and Chief Executive Officer AirWork._ - Mr. Frick founded
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AirWorks in 1994 and has built AirWorks into a $9 million/year provider of installation and certification services to the commercial airline industry. After completing a tour of duty with the at Boeing, America the and Navy's Blue Angels, Mr. Frick held senior management positions maintenance team ofWest U. S.Dalfort Aviation.
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Walter A. Marting, where Financial Officer ,Transdigital Communications -Mr. Bertagna, also came from Hughes Chief he served as financial consultant and, along with Mr. Marting established the industry's first airborne merchandising and fulfillment service, AMS, Inc., which supported Avicom's in-flight interactive systems on Northwest, Virgin Officer for AmaxAirlines. Prior to joining Hughes, Mr. Matting served as Chief FinancialAtlantic and China Europe a $200 million subsidiary of the company now known as Cyprus-Amax.
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Risk Factors
The major risk facing TCC is the availability of adequate funding to complete the satellite video receiver development Thea video receiver design specification and the selection of the for real time TV broadcasts. in timely fashion to meet the growing demand in the market development firm who will perform the design and manufacture the product have been finalized. Two potential satellite service providers have been identified and transponder time is being The negotiated to support Transportation Network. TCC has met with CNN and Warner Bros. who have verbally agreed to provide programming for Transnet; Buena Vista has given their written approval to TCC to use their product as well. The risk in the cruise line business is also driven by a timing issue. The pacing item is how quickly Transdigitalsystem. Currently partners can complete thesupplier offering a totally digital and its teaming Transdigital is the only integration of the GI/Vivid/Transtar solution which will operate on a ship's existing coax cable plant. With regard to software
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development,VOD, AOD and portfolio review are completed. A second and including gaming, shore tours, many of the major applications required by the cruise lines, higher level of passenger service application programs to support multi-language text menus and digital photography ofwill be completed afterresources. availability financial and human installation at a rate tied to customer demand and
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i June 1998 Page 22 Proprietary Information
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Exhibit A
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Transdigital Communications Corporation EBITDA Projection Combined Companies 1998 - 2000 Total 1998 Airline Product Revenues $337,798 Total 1999 $12,960,110 Total 2000 $22,802,801 Total Period $36,100,709
AirWorks Consolidated Revenues
$9,252,875
$12,368,720
$13,738,306
$35,359,901
Transtar Cruise Line System Revenues
$4,513,520
$10,310,840
$14,824,360
TTN Advertising Revenues
$17,242,726
$63,381,175
$80,623,902
Less: Airline Products Sales Commissions Less: TTN Adv. Sales Commisssions Less: Airline Adv. Revenue Share
($5,123)
($248,371) ($3,017,477) ($862,136)
($388,554) ($11,091,706) ($3,169,059)
($642,048) ($14,109,183) ($4,031,195)
TCC Total Net Revenues
$9,585,550
$42,957,092
$95,583,804
$148,126,446
Total Cost of Goods Sold Gross Margin
$6,930,409 $2,655,141
$19,530,837 $23,426,255
$28,476,703 $67,107,101
$54,937,950 $93,188,496
Total Operating Costs
$8,080,621
$17,471,741
$25,562,536
$51,114,898
Earnings Before Interest, Taxes I Depreciation and Amortization
($5,425,480)
$5,954,513
$41,544,565
$42,073,598
3:46 PM 9/9/98
ConsolCoJun98MadisonRevC.xls
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Transdigital Airline Products EBITDA Projections 1998 - 2000
Total 1998 Airline Product Revenues Less: Sales Commissions Maintenance Alert Revenues Total Airline Products Revenues Airline Products Cost of Goods Sold Airline Products Gross Margin Airline Products Allocated Share of Operating Costs Airline Products EBITDA
9/9/98 3:46 PM
Total 1999
Total 2000
Total Period
$337,798 ($5,123)
$12,418,565 ($248,371) $541,545
$19,427,693 ($388,554) $3,375,108
$32,184,056 ($642,048) $3,916,653
$332,675
$12,711,739
$22,414,247
$35,458,661
$205,767
$7,751,101
$12,714,841
$20,671,709
$126,909
$4,960,638
$9,699,406
$14,786,952
$2,624,062
$2,406,610
$2,724,785
$7,755,457
-$2,497,154
$2,554,028
ConsolCoJun98MadisonRevC.xls
$6,974,621
$7,031,495
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Transtar Cruise Line Systems EBITDA Projections 1998 - 2000 Total 1998
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Total 1999 $220,080
Total 2000 $990,360
Total Period $1,210,440
Transtar Software License Fees Transtar Hardware Revenues Cruise Line Service Fees Total Cruise Line Systems Revenues
$4,000,000 $293,440
$8,000,000 $1,320,480
$12,000,000 $1,613,920
$4,513,520
$10,310,840
$14,824,360
Total Cruise Line Systems Cost of Goods Sold
$3,000,000
$6,000,000
$9,000,000
Cruise Line Systems Gross Margin Cruise Systems Operating Cost Allocation (w/Maintenance Base Costs) Cruise Line Systems EBITDA
$1,513,520
$4,310,840
$5,824,360
$1,161,809
$1,797,204
$2,399,750
$5,358,763
($1,161,809)
($283,684)
$1,911,090
$465,597
9/9/98 3:55 PM
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TCC Satellite Broadcast Network Profit and Loss Statement 1998 -2001
Total 1998 Average CPM per Year TTN Gross Revenue (Net of Agency Commissions) Advertising Revenues Less: Advertising Sales Commissions Less: Airline Royalties
Total 1999 $12.00
Total 2000 $15.00
Total Period $13.50
$17,242,726
$63,381,175
$80,623,902
($3,017,477) ($862,136)
($11,091,706) ($3,169,059)
($14,109,183) ($4,031,195)
TTN Net Advertising Revenues
$13,363,113
$49,120,411
$62,483,524
TTN Gross Margin
$13,363,113
$49,120,411
$62,483,524
Total Operating Expense
$2,544,750
$11,363,927
$17,454,925
$31,363,603
EBITDA
-$2,544,750
$1,999,186
$31,665,485
$31,119,921
9/9/98 3:46 PM
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AirWorks EBITDA Projection 1998 - 2000
Total 1998 AirWorks Revenues Engineering Services Manufacturing and Assembly Installations and Certifications $1,168,729 $7,276,612 $807,534
Total 1999
Total 2000
Total Period
$1,260,000 $8,254,400 $2,854,320
$1,323,000 $9,244,928 $3,170,378
$3,751,729 $24,775,940 $6,832,232
AirWorks Total Revenues AirWorks Total Direct Costs AirWorks Gross Margin
$9,252,875 $7,080,460 $2,172,415
$12,368,720 $8,779,736 $3,588,984
$13,738,306 $9,761,862 $3,976,444
$35,359,901 $25,622,058 $9,737,843
AirWorks Total Operating Costs AirWorks EBITDA
$1,750,000
$1,904,000
$2,983,076
$6,637,076
$422,415
$1,684,984
$993,368
$3,100,767
9/9/98 3:46 PM
ConsolCoJun98MadisonRevC.xls
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I | EXHIBIT B List of References
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Dr. Ed Sun, founder of C-Cube, Chairman of Digital Video Systsems Robert Pfannkuch, PresidentYCEOof Panasonic Services Corporation George Mueller, former Vice President of American Airlines, current ice President of Canadian Airlines Charles Bucks, former Executive Vice President of Continental Airlines Dr. Richard Groves, Chairman and President of NAVCO Security Systems •Don Waite, CFO, Seagate Technolog3, Karel Lederboer, former Vice President KLM, current Senior DirectorTechnical of IATA
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Exhibit C TCC Shareholdings as of June 2, 1998 (Post RAB Products Merger)
Total TCC Shareholdings as of June 2, 1998 (Post RAB Products Memer) Shareholder SubtotalEmployees SubtotalCEU Investors SubtotalVenture Investors Hartford Holdings Total * Fully Diluted Total 3,816,785 583,163 Fully Diluted Total % 30.75% 4.70%
689,372 7,323,654 12,412,973
5.55% 59.00% 100.00%
• Assumes Full Conversion of All Convertible Notes and Includes All ISO Options Except Those Granted After 2June98
Transdigital Communications Corporation Confidential
9/9/98
Page 1
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I Exhibit D
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I Product Aircraft Brochures Pictures Antenna
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Digital Audio Player
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FEATURES
Upto 144(288optional) hoursofaudioprogramming
24 Audio outputchannels plus two PRAM/BGM outputs Softwareconfigurablechannel assignments 16bit CDquality digitalaudio OptionalPRAMfunctionality Destinationbasedadvertising, passengerinformation, and audioprogramming Extremelyreliable harddisk
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I The newAudioFile D Audio Player The AudioFile's aofaudioprogramgreat is fromTransdigital igital Communications (DAP) ofthe288totalhoursdvantage thatall Corporation amajor is breakthroughaudio ming(mono) apacityredigitally in c a commercialplayback Forthefirsttime, airline entertainment indus_ technology forthe airlines have can completeutomatedontrol a c overtheiraudio entertainment programs nd a diskdrive.na single audio recordedUpto24selectable hard o nineGigabyte tracks maybeplayed simultaneously. The output udio a channels canbecustomer The random access n technology providesature manyofharddisk software enabledenefits. b Route specific rop advertisingan c grammingnddestination a nowbeautomatically based inserted intotheprogramming mix based ontheflightdestination ithout w having change The to AudioFile's tapesPre-Recorded optional CD's. or Announcement andboarding usic M (PRAM) functionality ithinstantaw
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unique environment design. hisdesign patented resulting T fromAudioFile's employs configurediasoftware length mono orstereo v andtheprogram tobeeither is thelatest PEG M compressed digital ultime- selectable 24tracks m (e.g. oftwelve hours diatechnology toproduce CDquality audio in length). he T AudioFile's massiverop entertainment thantape or CDbased farmorereliably audio reproducers,
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gramstorage andseparaterograms neous which asoftware nabled capacity preloading upgrade is accesseliminates e ofnewprograms allows p theneed for fordifferent markets reastbound/west- anadditional o PRAM unitontheaircraft.
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AudioFileSpecificationSheet Channel apacity c (Player)................. 24 monaural(12 stereo)for entertainment . 2 monaural(1 stereo)for PRAM/BGM Channel apacity c (AODServer)......... 13 stereo . Audioprogramming capacity............ 4.2 6igabyteharddisk:144 hoursmonaural(72 hoursstereo)@128 Kbpsresolution . 9.1 Gigabyte harddisk:288 hoursmonaural(144 hoursstereo)@128 Kbpsresolution Frequencyesponse r ...........................50-15KHz (-3dB) Signalto noiseratio.......................... 70 dB • Dynamic range ................................... 85dB > Channel separation ............................ 65dB Outputlevelrange ..............................Upto +lOdB(factorypresetto 0 dBmmax.) Digitalcompression format................ MPEG Recording samplerate.......................32, 44.1or 48K samplespersecond Samplewordsize ...............................16 bit Harddisk size ....................................4.278Gigabyte (9.1Gbyteoptional) Processor. .......................................... DX4IOOMHz 486 Powerinput......................................... 115VAC,47-440Hz Powerconsumption ...........................70 watts max. Batterybackup ...................................10 secondridethrough Weight............................................... . 13.2Ibs (6.0 kg) Size .................................................... ATRshort (ARINC 1/2 592/628) Compliance ........................................ RINC A 628,ARINC 592 DataLoading ...................................... rontpanelSCSIport, RearconnectorETHERNET F lOBaseT Maintenance panel .............................FrontpanelLCDdisplayand keypad
I [a.ig tai Comm....i,,,o,., t I
I 1800EastLambertRoad• Suite230• Brea,CA 92821• Phone(714)671-3100• Fax (714)671-9800
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_ Simple and reliable Inexpensive lightweight and _ Major erviceupgrade s forFirstand/orBusiness Class d_ lrue AudioOnDemand (AOD): 1/10secondaccesstime
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Each AudioFile installed provides AODservice to 13 passengers
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Passengers enjoya selection upto 200musicalbumsand/oraudiobooks will of
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SystemOverview
Transdigital Communications Corporationasstrengthened h itsgroundbreaking AudioFileigital udio d a technology with the introductionof itsAudioFile AudioOnDemand (AOD)Systemfor the premiumcabinsof the world's airliners. This systemis truly revolutionary with substantial arketingadvantageso thoseairlinesthat offer m t AudioFile AODSystemaudioon demand serviceto their highendpassengers.Imagine sitting in your seatona long flight, selectingyourfavoritealbumfrom a list of 200 titlesandsitting backto relax,sleep,workor reada goodbookwith the musicyouenjoymost presented with CDqualityon your headset.Thisscenariois nowan inexpensive realitythat will providea powerfulboostto the airline'spremiumcabinservice. TheAudioFile AODSystemis targetedprimarilyat bothwideandnarrowbodyaircraftthat currentlyhavelimited entertainment optionsavailable first andbusinessclasspassengers.n particular,oday'slongerrangenarrow to I t bodyaircraftare excellent andidatesor the AudioFile c f AODSystemsincethis servicewill bea verywelcomeperk on the manyflights lastingoverthreehours. Thecornerstone the AudioFile of AODSystemis TCC'srevolutionary udioFileDigitalAudioServerwhichcan A simultaneously serviceupto thirteenpassengers ith instantaneous ccessto approximately w a 200musicalbumsor audiobooksthat aredigitallystoredonthe AudioFile's internalharddisk.Up to 144hoursof MPEG compressed stereoaudioprogramming canbestoredwithinthe 1/2 ATRshortARINC 592/628compliantpackage. A simpleandreliableaudio/data distributionsystemhasbeendeveloped connects passengero the that the t AudioFile's vastlibraryof audioentertainment_and information. hehardwirecabindistributionsystem,which T includesspeciallydesigned armrestmountedpassenger ontrolunits, is very inexpensive purchase,nstalland c to i maintain.It consistsof anAudioDistribution Unit (ADU)andsimple,customdesignedcableassemblieshat t connect he ADUwith the PCU's the seats.Thefully shielded t in systemcablingalsoprovidespassengers ith the w samehigh qualitysoundfoundin their livingrooms--they will beconvinced their headsets connected that i directly with their ownpersonalCDplayer. ll datacommunication A between seatPCU's the andthe ADUis via individual RS-485communication links. TheAudioFile AODSystempresents theforwardthinkingairlinewith a uniquemarketingopportunityto providefirst andbusinessclasscustomers with a truly premiumserviceat aneconomyclassprice.
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I Transdigital Communications Corporation |
I 1800 East Lambert Road • Suite 230 • Brea, CA 92821 • Phone (714) 671-3100 • Fax (714) 671-9800
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Airborne En Route Information System
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FEATURES Natural Three DimensionalShading CustomColorizedwith 32,000colorpallet SevenDifferentLevelsof MapResolution SphericalGlobe Routes Projectionsfor GreatCircle AvailableLANDSAT MetropolitanArea Views fromSpace WorldwideCoverage CitiesandLandmarks including 140,000 ForuseonAERISand AERISFX
Sevendifferentlevels of map resolution are available,including two very distinctiveand i databasefor aircraft position display TCChas developeda newgraphicalmap that is as unique as it is beautiful. The AERISAtlas uses sophisticatedshading havebeen "3-D"effect on by TCC's to createa custom coloredmaps that graphicarts group to presenta natural looking representationof the world both geologicallyand topologically.Ausedto of over 32,000 colors has been pallet createthis effect, world below: attentiongrabbing viewsof the 1) Sphericalglobeprojections which depict a three dimensionalearth floattion is highly effectivein showing pasing in a galaxy of stars. Thisprojecsengerson a North Pacificor North Atlantic flight that the aircraft is indeedtaking theshortest route highly betweentwo points and not the circular path as indicatedon the more common Mercatorprojections,
2) AnotherAERISAtlas first are MetropolitanArea ViewsFrom Space tographs actual LANDSAT which arethat allow the passengersto phoseethe aircraft's approachpath and destinationairport runways on the videoscreen. is also used to preTheAERISAtlas sent a colorful proximity screen that and landmarkswithin a 15 mile (25 shows the relativeposition of cities km) radius from theaircraft.
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Cooraton iTransdigital Communications ¢ ..... ..... ....
Level I Maps - Global views Theglobalviewlevelprovidesfor the presentation a flight pathas of viewedfromspaceat approximately22,000miles(geosynchronoussatellite distance). variety A ofviewsare provided whichpermit mostinternational flights be to presented n oneglobe(departure o pointto destination).
Level 2 Maps - HemisphericalViews TheHemispherical Viewlevelprovides forthe presentation a flightpathon a flat-map of viewwithapproximately of a hemisphere 2/3 presented. These veiwsareespeciallyseful u fortrans-Atlantic, trans-Pacific, andtransAsianroutes,
Level 3 Maps - Continentalviews TheContinental Viewprovides forthe presentation of aflightat a resolution roughlyequivalent that to of theNorth American Continent degrees (60 Iongirudeor 4,500 milesacross). hisprovides T anespeciallypleasant viewof trans-continental flights.The projectionselectedlsoillustrate advantagef s a the o the polarroutes takenonintercontinental flights.
Level 5 Maps State/Provinceviews TheState/Province iewprovides V a nicelocalized viewof flight informationata resolutionin whichatypicalstateor province would bebiewed(7-10degrees Iongititude about400 miles or across).Thisview presents an excellentviewof the overalltakeoff andappreachpatterns a for particulararea.
Level 4 Maps - Regional views TheRegionalViewLevelprovides thepresentation flight for of information a resolution 20 degrees at of longitude 1000 or milesacross.This resolution coverscompleteflightsfor most regionalflights andprovidesa reasonably detailedpresentation for all flights.
Level 6 Maps Greater Metropolitan views TheGreater etropolitan M View provides averylocalizediewof v flightinformationt a resolution a inwhich specific ityormetroa c politan areacanbe identified, and detailed take-off ndapproach a patterns canbeviewed.Thisview covers2-4 degrees longitudeor about 100-200milesacross.0ue to the significantdetailandlimitedcoverage this view,its appliof cationis restricted metropolito tan areaswithsignificantairport services,
Level 7 Maps - Landsat Photographs TheMetropolitan Viewfrom Space providesa digitally processed pictureof a major metropolitan area.This viewcovers approximately degreelongitudeor about40-75miles 1 withsignificantdetail(suchasairports,stadiums,majorhighways)highlyvisable.Viewsfrom spaceareavilablefor a large numberof metropolitan areas,but they arenot available all for possibleareas.Theseviewsarehighlycustomandmustbe selected an individualbasis. on
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1800 East Lambert Road ° Suite 230 • Brea, CA 92821 • Phone (714) 671-3100 ° Fax (714) 671-9800 I
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FEATURES Instantaneous Random Access VideoServer eliminatesneed for VTR g to TwelveHoursof Full tion Digital Videostored internally on HardDisk AutomatedVideoPlayback and/orCityPair Script basedonAircraft Position NewAERIS Atlas 3-DMap Database Scrolling TextMessages Full ColorStill Image Graphics •,- _"_ !7 ARINC628/AirbusPVIS Compliant1/2ATRPackage PRAMCapability
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The AERIS FXbuildsonthe i flightprogress DigitalVideo systemthat and The AERIS mapping FXisa Server exploitsthepowerof TCC's digital compression technologyo convert t a desirable assengergenerating ndcost p servicefroma cost centerintoa revenue a reducing means communicating the of to multimedia programming ade m possible customer. FXcannowbeintegrated Theexcitingworldof digital by theAERIS withexisting aircraftIFEsystems providing its customers, to significant enefits boththeairlineand b innovative traditionof original ERIS A in-flightinformation presentation, colormapsandrock solidin-service reliability, Thedigitalmultimedia of AERIS FXprovides design the anairlinewiththe first opportunityo communicate t toits i
Thisexclusive capability makes it possible safetybriefings(various for languages), frequentlierpromotions, destination videos, ustoms/immigration cf procedures, andevenmoviesto be
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whileat thesametimereducing or automaticallyr at therequest f the o o customersn thisnewdigitalmedium, exhibited theaircraftcabin icostsassociated ith to eliminating w flightcrew.Thecapability to videocassette logistics. p totwelve U automaticallyxhibff ighlylucrative e h video programming hoursofMPEG maybestoredon compressedigital d the unff'sinternal arddisk. h keythatunlocks programming the destinationasedreturnontheairline's b a is investment AERIS in FX.
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AERIS-FX Specificationheet S Combined VGAQualityMapGraphics MPEG & DigitalVideoOutput-NTSC 3.58 or Y/C 32,000ColorPalette UserProgrammable ScrollingTextFunction Two Simultaneous CDqualitystereoaudiooutputssupportup to four multi-language audiooutputs DigitalVolumeControlfor bothaudiooutputs Separate Monaural udiooutputsfor PAdistribution a VideoIn AWindowcapability 10 ARINC 429 Receivernputs(Supports I FMC,ADS,IRU,OMS,AGARS, DU,VCU,CMU) M 5 ARING Transmitter utputs(SupportsAGARS,MDU,VCU) 429 O 1 ARINC 561 6-WireInput 1 ARINC 565 3-WireSATInput 1 ARINC 565 3-WireTIG Input 1 ARINC 565 lO-Bit AltitudeInput 1 RS-485Remote ControlPort 12 SoftwareProgrammable Key_ine Inputs 4 SoftwareProgrammable Keyline Outputs FrontPanelLCDDisplay/Keyboard Maintenance Diagnostics for & 9 GB DiskDrivecancontainupto 12 hoursof digitalvideo Comprehensive-DColorMapDatabase ith dyers,lakes,mountains, ndpoliticalboundaries 3 w a AudioOutputLevel:-10 dBm(600 ohm) nominal AudioOutputFrequency Response: Hz- 15 Khz(-3dB) 50 AudioOutputPureToneDistortion(1 Khz,A-weighted): 0.3% AudioOutputDynamic Range: 85dB (referenced OdBm) > to AudioOutputCrossTalk<-65dB (1Khz,-lOdBm) AudioOutputSNR> 70 dB (0 dBmoutput) Two50/75ohm Coaxial VideoOutputs: omposite1V p-p,Y: 1Vp-p,G:0.286V p-p c Two100 ohm Balanced VideoOutputs:composite1Vp-p, Y: 1 Vp-p,G:0.286Vp-p Balanced Stereoand MonauralPrimaryAudioOutput Balanced tereoand MonauralSecondary udioOutput S A ARINC 628 Compatibility (additionaloutputsusereserved pins) HighSpeedEthernet lOBaseT) Interface SystemDownloading ( for Weight:13.2Ibs (6.0 kg) Power:115VAG;47-440Hz PowerConsumption: watts 75
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