Sample Business Plan

In the beginning … water covered the Earth.

Out of the water emerged an island,

a single giant mass of land;

an ancient supercontinent called Pangaea.

Over billions of years, tectonic forces broke

Pangaea apart, dividing the supercontinent into

ever distant land masses: Africa, Eurasia,

Australasia, North and South America.

As the land masses drifted farther apart, so too did

the people who inhabited them. Huge bodies of

water, time and space, separated people from their

friends, family, loved ones and partners in trade.

Until now…

Igæa: (eye-jee-uh) n: “i” mod. (interconnected; internet;idea); “Gaea” Grk. (earth; land). 1) The new supercontinent;a virtual place created through light speed communications; 2) Interconnected Earth; everywhere at once, omnipresent; 3) A global Internet Protocol (IP) communications networkcarrying streaming digital voice, video and data, transcendingphysical barriers, to bring all the people of the world togeth-er in one virtual place at any time.

page iv

Confidential

This corporate plan and all of its contents were produced internally by Igæa.

For more information contact: Kirk Rittenhouse Manz, CEO

Igæa

119 Windsor Drive

Nashville, Tennessee 37205

E-mail [email protected]

Telephone 615/353-9737

Facsimile 615/353-9521

www.igaea.com

2nd Quarter 2000

This business plan is provided for purposes of information and evaluation only. It

does not constitute an offer to sell, or a solicitation of securities, offers to buy or any

other interest in the business. Any such offering will be made only by appropriate

documents and in accordance with applicable State and Federal laws.

The information contained in this document is absolutely confidential and is intend-

ed only for persons to whom it is transmitted by the Company and to their imme-

diate business associates with whom they are required to confer in order to prop-

erly evaluate this business opportunity. By reading this document you agree not to

disclose the information contained herein regarding the Company, its owners,

employees, prospective employees, independent contractors, consultants, agents,

customers and prospective customers, marketing methods, products, services, strate-

gies, target markets, business plans, financial projections or any other information

regarded as trade secrets, confidential or proprietary to any other party not specifi-

cally outlined above without the express written consent of the Company.

Any reproduction of this document, in whole or in part, or the divulgence of any of

its contents in any form to unauthorized parties without the prior written consent of

the Company is expressly prohibited.

The Company believes the information set forth herein to be reliable. It must be

recognized, however, that predictions and forecasts regarding the Company’s future

performance are necessarily subject to a high degree of uncertainty. Therefore, no

warranty of such forecasts is express or implied.

If you desire additional information regarding Igæa, please contact the Company.

Important Information

Table of Contents

C O N F I D E N T I A L

page v

I. Executive Summary . . . . . . . . . . . . . . . . . . . 1

II. Management . . . . . . . . . . . . . . . . . . . . . . . .11

III. Financial Information Summary . . . . . . . . . . .15

IV. Comprehensive Strategic Marketing Plan . . . . .19

V. Network Deployment and Operations . . . . . .37

VI. Competition . . . . . . . . . . . . . . . . . . . . . . . . .47

VII. Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . .51

Introduction

1st International Telecom, Inc., dba

Igæa, a Delaware corporation was

formed in 1998 and incorporated in

September 1999, to capitalize on

emerging market opportunities in the

VoIP internet telephony industry and to

provide unified communications serv-

ices to a global business and consumer

marketplace.

Igæa has partnered with Cisco

Systems, Inc., one of the most valu-

able companies in the world.

Cisco, the leading maker of internet

traffic equipment, has provided

Igæa with a commitment of $60

million in vendor financing to facil-

itate the systematic deployment of

Igæa’s global voice and data net-

work.

Igæa’s core executive management

team consists of highly experienced

telecom sales, marketing and technolo-

gy professionals who have developed

and managed over $300 million in

global voice revenue for top ten carri-

ers.

Igæa will deliver Voice over Internet

Protocol (VoIP) international long dis-

tance calling, as well as enhanced

voice, data and video communications

services to a global residential and

commercial customer base, using

proven tactical and strategic sales ini-

tiatives and established wholesale and

retail sales channels.

Executive Summary


page 1

Igæa will become a worldwide

leader in offering carrier-grade,

phone-to-phone VoIP international

calling and bundled communica-

tions services in selected markets

in the Americas, Europe, Australia,

Asia, Africa and the Middle East.

Igæa’s current funding consists of $60

million in vendor financing provided

by Cisco and $2 million in early stage

equity. This, combined with an antici-

pated $30 million plus in additional

equity will enable the rapid deploy-

ment of the Company’s global VoIP

voice and data network. Upon comple-

tion of its second round equity fund-

ing, Igæa will emerge as one of the

best-funded startups in the IP telepho-

ny industry.

In the next two years, Igæa will

deploy over one hundred Cisco IP

gateways domestically and abroad

to enable access and egress for

internet protocol telephone calls,

data networking and video distribu-

tion.

The Company will provide high-quali-

ty connectivity into both established

and emerging economies and will

exchange IP traffic with carriers, inter-

net service providers (ISPs) and inter-

net telephony services providers

(ITSPs) worldwide to enable carrier

grade origination and termination.

Igæa will deliver Voice

over Internet Protocol

(VoIP) international long

distance calling, as well

as enhanced voice, data

and video communica-

tions services to a global

residential and commer-

cial customer base, utiliz-

ing proven tactical and

strategic sales initiatives

and established wholesale

and retail sales channels.

Executive Summary


page 2

Igæa will deliver its bundled services to

consumers and businesses through

both wholesale and retail channels and

will develop a comprehensive web

presence designed to serve the needs

of all international callers.

Cisco recently granted Igæa its cov-

eted Cisco Powered Network status,

placing Igæa in the top 1% of serv-

ice providers worldwide.

The Company’s proposed global IP

telephony clearinghouse will seamless-

ly integrate IP calls with traditional

voice network calls to provide Igæa

customers with comprehensive global

access from any phone (wired or wire-

less) to any other phone in the world.

Igæa’s veteran management team will

deliver a unique combination of tech-

nical understanding, extensive opera-

tional experience, valuable industry

contacts and a demonstrated ability to

successfully and rapidly generate a

profitable mix of retail and wholesale

revenues.

By combining its core competencies of

deploying next-generation technology

with extensive expertise in internation-

al communications and ethnic market-

ing, Igæa will create a sustainable com-

petitive advantage and significant value

for its shareholders.

Market Opportunity: Voice over Internet Protocol (VoIP)

According to the Gartner Group, a leading

market research firm, the global telecom-

munications market is expected to grow

to approximately $1.9 trillion by 2003.

Voice over Internet Protocol (VoIP) is the

future of voice communication and will

soon replace the traditional circuit

switched long distance telephone tech-

nology used throughout the world today.

According to Killen & Associates, as much

as 33 percent of all voice traffic will be IP-

based by 2005.

VoIP technology allows for the conversion

of voice to data by a process of slicing

analog voice signals into digital “packets”

that can be transmitted over a data net-

work, such as the internet, at a fraction of

the cost of a traditional circuit switched

call.

Total IP voice minutes will rise from

less than 300 million minutes in 1998

to almost 140 billion minutes in 2004

(source: IDC).

Upon completion of its

second round equity

funding, Igæa will emerge

as one of the best-funded

startups in the IP

telephony industry.

20042003200220012000199919980

20

40

60

80

100

120

Retail Consumer

140

Retail Business Wholesale

Worldwide Retail & WholesaleIP Telephony Minutes 1998 - 2004

MOUs [Billion]*

*Minutes Of Usage

According to Killen &

Associates, as much as 33

percent of all voice traffic

will be IP-based by 2005.

Executive Summary


page 3

The pricing advantage for data trans-

mission, including VoIP long distance

calling, is particularly attractive for long

haul transmissions terminated interna-

tionally.

The market for Internet telephony is

projected to grow from less than $1 bil-

lion in 1998 to over $18 billion in 2004,

according to International Data

Corporation, a market research firm.

IP continues to emerge as the domi-

nant technology in all its architectural

variations. Mainstream telecom ven-

dors are repositioning themselves to

support voice and data integration

through major acquisitions and

alliances as evidenced by Nortel’s

merger with Bay Networks, Lucent’s

acquisition of Ascend and Excel, and

Cisco’s purchase of Summa Four.

In the past twenty-four months, major

internet telephony service providers

(ITSPs) with large global infrastruc-

tures, such as IDT/Net2Phone and

iBasis, have emerged. Some, especially

in the U.S., are moving beyond the

lowest cost provider market to offer

value-added services such as virtual

private networks (VPNs). These ITSPs

are negotiating interconnection and

partnering agreements to create wide

area VoIP networks to rival the tradi-

tional circuit switched networks of the

world’s incumbent Telcos. For exam-

ple, Rimnet and iBasis have intercon-

nected their networks in the U.S. and

Japan, while ITXC, Deltathree and

iBasis have additional peering arrange-

ments in place.

Large telcos are buying internet service

providers (ISPs), VoIP vendors and

portals to hedge their risks and to pro-

vide fast and efficient market entry

opportunities. NTT acquired equity in

Igæa projects $500 mil-

lion in annual revenues

within five years.

Igæa will provide

wholesale services to

international long

distance carriers and will

provide higher margin

retail services direct to

the consumer.

20042003200220012000199919980

International

20

18

16

14

12

10

8

6

4

US Long Distance

2

Worldwide U.S. LD and InternationalIP Telephony Revenues, 1998 Ð 2004

Revenues [$ Billion]

20042003200220012000199919980

Retail

20

18

16

14

12

10

8

6

4

Wholesale

2

Worldwide Retail & WholesaleIP Telephony Revenues 1998 - 2004

Revenues [$ Billion]

Executive Summary


page 4

U.S. ISP Verio, Deutsche Telekom

bought 20 percent of Vocaltec, MCI

WorldCom acquired CompuServe’s net-

work and ANS Communications from

AOL, while GTE acquired BBN. BT

has invested in Excite and Deutsche

Telekom in Infoseek.

Telcos are also forming strategic part-

nering relationships with ITSPs. For

example, Ameritech/KPN/Qwest;

NTT/Global-net/InterTel/Telba; and

the recently announced JT/ITXC

alliance are the first of many future

arrangements.

ITSPs are building their own version of

the current accounting rate system and a

clearinghouse business is emerging

involving major players such as ITXC,

GRIC, eGlobe, ArbiNet, and iBasis.

Igæa will deploy VoIP

facilities in Los Angeles,

New York and Miami with

a proposed “go live” date

of July 1, 2000 and will

implement an aggressive

rollout of over one hun-

dred additional points of

presence (POPs)

throughout metropolitan

centers in the U.S. and

abroad within twenty-

four months.

On November 10, 1999, Burlington,

Massachusetts-based iBasis (IBAS) success-

fully completed its IPO. iBasis operates a

worldwide VoIP network that provides

wholesale services to international long dis-

tance carriers.

Igæa will provide wholesale services to

international long distance carriers and

will provide higher margin retail servic-

es direct to the consumer.

iBasis sold 6.8 million common shares at

$16 each, raising $108.8 million on annual-

ized revenues of less than $17 million.

Igæa projects $500 million in annual

revenues within five years. To date, the

founders and management team of

Igæa have personally managed or devel-

oped a combined $300 million in global

voice and data revenue.

The iBasis network includes facilities in Los

Angeles and New York that serve as access

points to the Internet. At these locations,

iBasis translates voice to data for transmis-

sion and retrieval over the Internet.

Igæa will deploy VoIP facilities in Los

Angeles, New York and Miami with a

proposed “go live” date of July 1, 2000

and will implement an aggressive roll-

out of over one hundred additional

points of presence (POPs) within met-

ropolitan centers in the U.S. and abroad

within twenty-four months.

Igæa will distinguish itself in both

its revenue and profit generating

capacity and brand development

expertise to establish itself as a

world class and pre-eminent, tier 1

VoIP carrier.

Igæa will build a global VoIP integrat-

ed data communications network

working in close partnership with

Cisco to serve all internationally

focused retail markets in the United

States, including targeted ethnic com-

munities and small to medium sized

business customers, and to serve inter-

national callers in Europe, Asia and

emerging economies.

Executive Summary


page 5

iBasis achieved a $487 million valua-

tion at IPO.

Igæa anticipates achieving a mini-

mum $1 billion valuation within

three years.

The Company believes that iBasis’ val-

uation and other IP telephony valua-

tions referenced below demonstrate

the public market’s support for emerg-

ing VoIP carriers and the scope and

depth of the expanding international

voice and data services market, and

provides an example to investors of

potential returns.

The Company has devel-

oped strong relationships

with a significant number

of professional sales

agents who maintain

established customer

bases and implement

time tested methods of

marketing.

U.K.

7¢per minute

No switching!

No monthly fees!

No hidden charges!

Pay only for theminutes you use!

ig¾awhat a good id¾a...

ª

¨

iBasis Net2Phone ITXC GRIC Deltathree

1999 Est. Revenue $19M $47M $25M $10M $11M

IPO Date 11/9/99 7/28/99 9/27/99 12/14/99 11/22/99

Gross Proceeds $109M $81M $75M $64M $90M

Offer Price $16 $15 $12 $14 $15

Closing Stock Price $40.30 $26.56 $28.25 $21.00 $29.00

Market Value at IPO $487M $707M $429M $248M $414M

Products & Services

Igæa will deliver an extensive array of

IP products and services to include:

• VoIP “packetized” voice [long dis-

tance]

• Fax over internet protocol (FoIP)

• Internet access

• Unified messaging

• Data transmission

• Interstate and international long dis-

tance

• Dial around/casual calling [long dis-

tance]

• Prepaid calling [long distance]

• Enhanced services to include voicemail,

conference calling and information

services

• Virtual calling cards generated via

the internet

• International call back

• Internet initiated call back and web

conference calling (Call Navigator)

• Video conferencing and multimedia

distribution

The Company’s VoIP products can be

used from any phone, wired or wire-

less, to any phone in the world.

Wireless users will benefit from special

features and rates offered by the

Company including the ability to

bypass their wireless provider to place

international calls at reasonable prices.

Executive Summary


page 6

Igæa will generate voice and data

revenue through three active sales

channels consisting of independent

contractor agents; certified resell-

ers; and strategic media, corporate

and affinity partnerships.

The Company will also generate rev-

enue through a fourth global clearing-

house channel consisting of revenues

derived from VoIP network affiliates in

both the U.S. and abroad, that desire to

terminate traffic in the United States or

around the world utilizing the

Company’s IP gateways, underlying

intelligent network, and billing and

consolidation services.

5.9¢per minute

forGigglesGiggles5.9¢

per minute

for

No switching!

No monthly fees!

No hidden charges!



ª

¨

The Company’s VoIP prod-

ucts can be used from

any phone, wired or wire-

less, to any phone in the

world.

Marketing Strategy:Agent

Independent sales agents provide an

opportunity for immediate revenues to

the Company with essentially no up-

front investment in marketing and cus-

tomer acquisition.

The Company has developed strong

relationships with a significant number

of professional sales agents who main-

tain established customer bases and

implement time tested methods of mar-

keting. All of these committed Igæa

agents currently target international

callers within specific ethnic niches

and have demonstrated a particularly

effective ability to market to interna-

tional callers within their communities.

Some Igæa agents utilize sophisticated

back office systems to support their

marketing efforts and to provide per-

sonalized and culturally sensitive front

line customer support to their clientele.

Many of Igæa’s “Master Agents” typ-

ically service over 1,000 customers

and generate aggregate gross rev-

enues of $500,000 to $5 million per

annum.

Igæa agents will receive a residual

commission payment for sales they

generate, hence their motivation to

attract and keep high quality cus-

tomers. This pay-for-results method of

revenue generation will enable Igæa to

fix its cost of sales as a percentage of

revenue and to cost effectively deploy

a worldwide sales force.

The Company’s VP of Agent Sales

managed more than $180 million

in annual revenues at Telegroup

through a global agent network

consisting of 1,400 agents in 100

countries. The Company has, to

date, recruited twenty-six Master

Agents, representing a potential

$20 million in VoIP long distance

revenues.

The Company has, to

date, recruited twenty-

six Master Agents, repre-

senting a potential $20

million in VoIP long dis-

tance revenues.

Executive Summary


page 7

• 5.9¢ per minute!• Works on your phone now!• No switching!• No monthly fees!


ª

¨

Marketing Strategy:Reseller

On a wholesale basis the Company will

provide its services in a turnkey format

to established industry resellers.

Industry resellers consist of independ-

ently licensed telecom resellers and/or

sales organizations with established

product distribution channels that

either currently sell communications

services or can easily be converted to

accommodate the sale of communica-

tions services.

Igæa will have access to several indus-

try resellers through its current estab-

lished relationships and will develop

new sales channels as part of its ongo-

ing strategy to grow its wholesale rev-

enue base.

The Company’s Vice President of

Value Added Services has joined

Igæa from Teleglobe where he man-

aged over $100 million in revenue.

He brings with him established cus-

tomer relationships and immediate

access to new reseller commit-

ments worth $5 - $10 million in

year 2000 revenues with a project-

ed 20% growth rate per quarter.

As compared to current

competitors in the mar-

ketplace, Igæa’s core

marketing competency

and ability to generate

real revenue growth

and profitability will

enable the Company to

achieve market valuations

significantly greater than

its peers.

Executive Summary


page 8

Marketing Strategy: Strategic Partnerships

Igæa has designed an innovative retail

marketing strategy that leverages coop-

erative media and marketing relation-

ships and strategic alliances in order to

create the appearance and effect of a

nationwide, multi-million dollar adver-

tising, marketing and public relations

campaign, at a fraction of the cost of

traditional media coverage.

The Company will advertise through

numerous media, including television,

radio, newspaper, magazines, web por-

tals, catalogs, flyers, statement stuffers

and various point of purchase loca-

tions, and will fund this marketing

effort by entering into joint venture

agreements with media, corporate and

affinity partners to share in the long

distance revenues generated by the

program.

Specifically, the network dial up nature

of most of the Company’s services

allows for unlimited toll free and local

access numbers to “point” to the

Company’s network switching plat-

forms, thus facilitating the assignment

of unique numbers to each cooperative

advertising partner or industry reseller

for billing, tracking, provisioning of

enhanced services (such as customized

greetings) and commissioning.

Through the use of unique access

numbers, the Company will allocate a

percentage of revenues generated on a

given number to the partner responsi-

ble for promoting that number.

Calls generated on a given access num-

ber provide direct data to the Company

on the effectiveness of a given adver-

tising campaign and/or the responsive-

ness of a given market segment. Such

tracking allows the Company to focus

quickly on effective strategies and

responsive audiences. In this manner

the Company is able to track tradition-

al media advertising effectiveness with

the efficiency of a direct response cam-

paign.

Potential revenue sharing partners for

the Company include:

• Individual television and radio sta-

tions looking for the next successful

per inquiry infomercial to provide

residual monthly income;

• Credit card companies interested in

generating profits from billing state-

ments;

• Affinity groups searching for new

sources of revenue that are market

driven and require little sales effort,

distribution, maintenance or person-

nel;

• Newspapers or magazines with rem-

nant advertising space currently

going to waste;

• Network marketing companies or

service companies looking for new

products;

• Internet portals eager to increase

advertising revenues through cre-

ative deal structuring;

• National retailers and member

organizations seeking new service

offerings;

• Cable television providers or utility

companies looking to bundle tele-

com services.

Executive Summary


page 9

Conclusion

Igæa will emerge as a dominant com-

munications services provider at the

crest of a rapidly converging wave of

voice and data technology. Igæa’s core

management team will incorporate that

technology into a comprehensive

voice, data and internet solution serv-

ing an internationally focused residen-

tial and business customer base world-

wide.

The Company has the demonstrat-

ed ability to drive revenue in excess

of $10 million in 2000 and to sus-

tain growth to over $200 million in

annual sales by 2003.

Igæa believes that its unique combina-

tion of both wholesale and direct to

consumer sales will distinguish it from

its competitors and create lasting rela-

tionships that add sustained value to

the enterprise. As compared to current

competitors in the marketplace, Igæa’s

core marketing competency and ability

to generate real revenue growth and

profitability will enable the Company

to achieve market valuations signifi-

cantly greater than its peers.

Igæa will act quickly to become a first

mover in a rapidly developing market-

place and by implementing a balanced

yet aggressive approach to growth.

Through a series of private placement

equity offerings and a strategy to lever-

age equity through appropriate access

to the extensive credit resources from

leading technology providers such as

Cisco and other committed partners,

the Company will build a state-of-the-

art global VoIP voice and data network.

With this network, Igæa will deliver

increased value propositions to its cus-

tomers, generate steady revenue and

profit growth, and achieve rapid appre-

ciation of its market valuation yielding

positive ROI to its shareholders.

Executive Summary


page 10

Management


page 11

Founder - Kirk R. Manz,

CEO/President.

Former CEO and founder, Fifth Coast

Communications, LLC, a long distance

marketing firm that generated over

225,000 customers for LCI

International in just 18 months.

Former CEO and founder, The Kiman

Corporation, a provider of computer-

telephony products and services.

Former President and founder,

Communications Unlimited, Inc., a

marketing consulting firm. BA Com-

munications, Vanderbilt University.

Founder - Robert H. Woodward,

Executive Vice President.

Former President and founder, Fifth

Coast Communications, LLC. Former

President, The Kiman Corporation.

Juris Doctor, UCLA. Member California

State Bar and American Bar

Association. Former Military

Intelligence NCO, U.S. Army, 101st

Airborne Division. BA, Spanish/

Communications, Austin Peay State

University.

Chief Financial Officer -

Robert Ling.

Former National Partner-in-Charge of

Corporate Finance & Valuation Services

to Telecom & Media Industries,

Deloitte & Touche (Atlanta). Former

Managing Director, Financial Advisory

Services - Eastern Europe and Russia,

Deloitte & Touche (Prague). Former

Manager, Valuation Group, Ernst &

Young (Dallas). Former Controller/

Treasurer Mutual Oil of America, Inc., a

publicly-traded oil and gas company.

MBA Finance, University of North

Texas, CPA, CFA.

Vice President Traffic Management -

Edward C. Morché.

Former Director LCR, Teleglobe.

Directly responsible for the buying and

routing of 5 billion minutes per year,

annual cost reduction in excess of 20%,

wholesale broadcast sales, and voice

quality of service. Former Manager

LCR, Teleglobe. Former Manager of

Business Operations, Global One.

Former Project Manager, Sprint

International. Bachelor of Architecture

(Professional Degree), Catholic

University. BS, Architecture, Catholic

University.

The founders and man-

agement team of Igæa

have personally managed

or developed a combined

$300 million in global

voice and data revenue.

Vice President Corporate Affairs -

Paul Myers.

Former Senior Vice President and

Market Executive Commercial Banking,

NationsBank Corp. Former Vice

President Business Development,

Suntrust Banks, Inc. BA, Economics,

University of the South.

Project Manager - Network Design

and Implementation - Greg Johnson.

Currently contracted to Igæa through

NetEffect. Former Network Design

Engineer, Sprint (14 years). Three

patents: call processing cache for local

number portability (granted), cache for

800 number database (pending), voice

verification utilizing ATM connectivity

(pending).

Senior Director Least Cost Routing -

Scott Sanders.

Former Senior Manager, European

Region, Global Traffic Organization,

Teleglobe. Former Regional Manager,

Western Europe - Least Cost Routing,

Teleglobe. Former Project Lead -

Network Cost Management, MCI.

Former Business Analyst - Network

Cost Management, MCI. MBA, BS,

Virginia Polytechnic Institute.

Management


page 12

Vice President Agent Sales -

Carl Churchill.

Former Executive Director of Sales and

Marketing, Managing Director of

Global Sales Agent Development, and

Director of North American

Operations, Telegroup Inc. Responsible

for a worldwide network of agents gen-

erating in excess of $180 million in

annual revenues. Holds the rank of

Major in Military Intelligence, U.S.

Army Reserves. MA in Strategic

Intelligence, Defense Intelligence

College. BA International Relations,

German, University of Utah.

Vice President Value Added Services -

Taj Mehta.

Former Sales Director, Teleglobe.

Directly responsible for the development

and management of an estimated $110

million in long distance revenue.

Former Product Manager for dial around

services, Teleglobe. Former Market

Manager, International Markets, MCI.

Former District Manager of International

Marketing, MCI. MA of International

Studies, University of Washington. BA,

University of California San Diego.

Founder - George Jagoe,

Vice President Strategic Planning.

Former Assistant Country Manager,

Argentina, Aetna International. Former

Senior Product Manager, Kaiser

Permanente. Former Member/ Director,

Fifth Coast Communications, LLC. MBA,

Kellogg School of Business

Management. BA, Harvard University.

Igæa’s Vice President

Agent Sales generated

over $180 million in

annual revenues through

a worldwide network of

1400 agents.

Management


page 13

Senior Director of Brand

Development - Whitney Selert.

Former Litigation Attorney, Georgeson,

Thompson & Angaran. Juris Doctor,

University of California, Davis. Law

Clerk, U.S. Ct. of Appeals, 9th Circuit.

Interrogator, 219th Military Intelligence

Company, U.S. Army. BA, Brigham

Young University.

Senior Director of Creative Services -

Ed Brown.

Former Creative Director, New Media

Directions. Former Interactive Media

Director, Dye, Van Mol and Lawrence.

Former Member/Creative Director, Fifth

Coast Communications, LLC. Former

Principal, Small World Productions. BA,

Mechanical Engineering, Southern

Methodist University.

Senior Director of Interactive Media -

Mitch Powers.

Former Producer, Little Planet Learning.

Former Member/Vice President

Operations, Fifth Coast Communications,

LLC. Former Principal, Small World

Productions. Former Principal,

Campbell-Powers Communications. BS,

Communications, University of

Tennessee, Knoxville.

Director of Human Resources -

Michael Magevney.

Former Special Projects Director, AIM

Healthcare Services. Former Executive

Director, Arcon Navarre. Former

Executive Director and Co-Founder,

Break Away. MBA, Owen Graduate

School of Management. BA,

Philosophy, Vanderbilt University.

Director of Customer Service -

Debora Churchill.

Former Director of North American

Customer Service, Primus. Former

Assistant Manager North American

Customer Service, Telegroup, Inc.


Value Added Services

generated over $110

million in long distance

revenues through the

development of unique

reseller channels.

Management


page 14

Counsel

The Company has retained the services

of the following law firms:

• Covington & Burling, Washington

Ralph Voltmer

• Greenberg & Traurig, Washington

Ronald Scheman

• Alston & Bird, Atlanta

Dominic Mazzone

• Boult Cummings, Nashville

Henry Walker

• Tuke Yopp & Sweeney, Nashville

Michael Yopp

Accounting

Roth Bookstein and Zalslow (Los

Angeles) currently serves as the

Company’s accountants. The Company

is currently reviewing proposals from

the following firms: Deloitte and

Touche, Ernst and Young, KPMG,

and Arthur Andersen.

The Company has hired the following

additional key personnel.

Dir. North American Agent

Development - Doug Huette.

(formerly with Telegroup/Primus)

Dir. International Agent

Development - Laura Miller.


North American Support Specialist -

Aida Douglas.


Agent Team Leader - Charlotte Pfab.


Administrative Support -

Rachel Heckthorne.


Bookkeeper - Mary Jones.

(formerly with PictureVision)

The Company is actively recruiting the

following additional key personnel:

• COO

• CTO

• CNO

• Director MIS

• Controller


Traffic and Network

Optimization was

responsible for the buying

and routing of 5 billion

minutes in 1999.

Financial Analysis andCapitalization Requirements


page 15

Igæa is uniquely poised to become a

global competitor as a comprehensive

Integrated Communications Services

Provider (ICSP) and to achieve a mar-

ket valuation in excess of $1 billion by

2003.

The Company has raised over $62

million in debt and equity to date:

Founder’s $ 60,000Equity

Seed Round $ 150,000Equity

Series A Preferred $ 1,800,000Equity

Cisco Capital $20,000,000Working Capital

Cisco Capital $40,000,000Equipment Loans

Total Capitalization $62,010,000

Of the $60 million provided by Cisco

Capital, the Company has immediate

access to $6 million ($2 million work-

ing capital and soft costs; $4 million

equipment). The balance of $54 mil-

lion is available to the Company upon

securing an additional $15 million in

equity.

The Company is raising an additional

$15-$30 million in Series B Preferred

Equity to fund additional management

and personnel recruitment, carrier

access and wholesale purchase agree-

ments, computer programming, cus-

tomer service outsourcing commit-

ments, ethnic marketing and advertis-

ing consulting, advertising production,

marketing expenses, sales and support

staff, management, general and admin-

istrative expenses, and deployment of

the Company’s global VoIP voice and

data network.

Exit Strategy

The Company foresees three potential

exit strategies and plans to periodically

evaluate the advisability of:

1) undertaking an initial public offering

of its equity securities as a source of

additional financing and/or to provide

early stage investors with liquidity;

2) repurchasing shares of early investors

with future current cash flow or

through a strategic partnering; and,

3) positioning all or part of the assets of

the company as an attractive acquisi-

tion target for a larger domestic inter-

exchange carrier (IXC) seeking to

enhance existing revenue and net-

work traffic, an incumbent or com-

petitive local exchange carrier

(ILEC/CLEC) seeking to enter the

international VoIP market, or a for-

eign telecommunications provider

(PTT) seeking to enter the U.S. mar-

ket and expand its own VoIP network

capacity.

The company has raised

over $62 million in debt

and equity to date.



page 16

2000 2001 2002 2003

Revenues $9,797,500 $51,128,073 $104,157,576 $209,825,283

Cost of Sales (incl. Commissions) 1,371,650 7,157,930 14,582,061 29,375,540

Circuit Switching and Billing 6,142,225 27,503,964 43,541,963 62,561,294

VOIP Network Expenses 2,310,000 6,660,000 21,505,467 62,188,177

Total Direct Costs 9,823,875 41,321,894 79,629,490 154,125,010

Gross Profit (26,375) 9,806,179 24,528,085 55,700,273

Total Operating Expenses 3,625,000 9,300,000 16,500,000 23,700,000

EBITDA (3,651,375) 506,179 8,028,085 32,000,273

Depreciation & Amortization (1,233,395) (6,833,675) (8,000,400) (8,000,400)

Interest Income 318,423 782,287 565,203 424,944

Interest & Financing Expense (2,015,000) (6,459,256) (6,001,955) (3,908,195)

Provision for Income Tax - - - (3,197,900)

Net Income (loss) ($6,581,347) ($12,004,466) ($5,409,067) $17,318,721

Igæa Projected Income Statement

Igæa is uniquely poised to

become a global competi-

tor as a comprehensive

Integrated Communications

Services Provider (ICSP)

and to achieve a market

valuation in excess of

$1 billion by 2003.

2000 2001 2002 2003

Current Assets

Cash $22,963,235 $23,605,847 $13,063,291 $19,456,075

New Accounts Receivable 565,250 1,158,189 2,349,773 4,709,520

Cumulative Accounts Receivable 1,112,250 3,088,562 6,277,147 12,608,356

Total Current Assets 24,640,735 27,852,599 21,690,213 36,773,952

Fixed Assets

Equipment - Capital Lease 20,001,000 40,002,000 40,002,000 40,002,000

Less Accum. Deprec. & Amort. (1,233,395) (8,067,070) (16,067,470) (24,067,870)

Total Fixed Assets 18,767,605 31,934,930 23,934,530 15,934,130

Total Assets $43,408,340 $59,787,529 $45,624,743 $52,708,082

Liabilities & Stockholders’ Equity

Current Liabilities

Accounts Payable 2,929,687 5,418,297 10,491,024 19,263,141

Obligation for Working Capital 9,999,000 18,339,463 13,473,860 7,138,661

Current Due 260,000 1,131,151 1,902,974 1,902,974

Total Current Liabilities 13,188,687 24,888,912 25,867,859 28,304,777

Long Term Notes Payable

Obligation Under Capital Lease 20,001,000 36,684,430 26,951,763 14,279,464

Total Long Term Liabilities 20,001,000 36,684,430 26,951,763 14,279,464

Stockholders’ Equity (Deficit)

Equity Investments 17,025,000 17,025,000 17,025,000 17,025,000

Retained Earnings (Deficit) (225,000) (6,806,347) (18,810,812) (24,219,880)

Current Earnings (Loss) (6,581,347) (12,004,466) (5,409,067) 17,318,721

Total Stockholders’ Equity (Deficit) 10,218,652 (1,785,812) (7,194,880) 10,123,840

Tot. Liabilities & Stckhldrs’ Equity $43,408,340 $59,787,529 $45,624,743 $52,708,082

Notes

* Based on $15M minimum Series B equity contribution



page 17

Igæa Projected Balance Sheet

2000 2001 2002 2003

Cash Flows From Operations

Net Income (Loss) ($6,581,347) ($12,004,466) ($5,409,067) $17,318,721

Adjustments

Depreciation & Amortization 1,233,395 6,833,675 8,000,400 8,000,400

Changes in Operating Assets & Liabilities

Net (increase)/decrease in Accounts Receivable (1,677,500) (2,569,252) (4,380,170) (8,690,956)

Net increase/(decrease) in Acct. Pay & Accr. Liabilities 2,929,688 2,488,610 5,072,728 8,772,117

Net increase/(decrease) in LOC 260,000 871,151 771,823 -

Net Cash Provided (Used) In Operations (3,835,765) (4,380,281) 4,055,714 25,400,283

Cash Flow from Financing Activity

Capital Expenditures (20,001,000) (20,001,000) - -

Principal Payments on Obligations - (4,976,106) (14,598,270) (19,007,499)

Increase (Reduction/forgiveness) in Capital Lease 20,001,000 20,001,000 - -

Increase (Reduction/forgiveness) in WC Loan 9,999,000 9,999,000 - -

Proceeds From Equity Financing(s) 16,800,000 - - -

Net Cash Provided (Used) in Financing Activity 26,799,000 5,022,894 (14,598,270) (19,007,499)

Net Increase (Decrease) in Cash 22,963,235 642,612 (10,542,556) 6,392,784

Beginning Cash Balance - 22,963,235 23,605,848 13,063,292

Ending Cash Balance $22,963,235 $23,605,848 $13,063,292 $19,456,075

Notes

* Based on $15M minimum Series B equity contribution



page 18

Igæa Forecasted Cash Flow

Market Opportunity

The international telecommunications

industry consists of transmissions of

voice and data that originate in one

country and terminate in another. This

industry is experiencing a period of

rapid change which has resulted in a

substantial growth in international

telecommunications traffic. For

domestic carriers, the international

market can be divided into two major

segments: the U.S.-originated market,

which consists of all international calls

which either originate or are billed in

the United States, and the overseas

market, which consists of all calls

billed outside the United States.

Igæa will capitalize on the U.S. origi-

nated market by implementing agent,

reseller and cooperative sales and mar-

keting strategies in the United States.

With continued growth and proven

revenues, the Company will expand

internationally by deploying a global

VoIP infrastructure which will allow

Igæa to operate as a global facilities-

based carrier. As early as 3rd quarter

2000, the Company plans to:

• Increase transmission capacity,

including its ability to originate and

transport traffic through the deploy-

ment of additional VoIP gateways

provided by Cisco either directly in

country or through strategic partner-

ships with other VoIP providers;

• Acquire additional termination

options to increase routing flexibility;

and

• Expand its customer base through

focused marketing efforts with the

long term objective of becoming a

tier 1, comprehensive, international,

facilities-based, VoIP carrier and inte-

grated communications services

provider.

Igæa is uniquely positioned to emerge

as a first mover in acquiring consumer

and small business market share as a

unified communications services

provider utilizing an underlying VoIP

network. The Company will leverage

its competitive advantage and its first to

market position in a variety of geo-

graphic, demographic and technology

sectors by bundling services; providing

convenience, efficiency and lower

prices; and by procuring long term,

exclusive marketing contracts with

strategic partner providers including

major media and corporate marketing

partners, thus establishing formidable

obstacles to entry to would-be com-

petitors.

By developing a balanced and distrib-

uted mechanism for organic sales

growth, along with a focused approach

to infrastructure deployment, Igæa,

along with its agents, resellers and

Igæa will capitalize on

the U.S. originated mar-

ket by implementing

agent, reseller and coop-

erative sales and market-

ing strategies in the

United States.

Comprehensive Strategic Marketing Plan


page 19

retail corporate and media partners,

will bring today’s newest voice, data

and internet technologies to both resi-

dential and business customers world-

wide as these technologies emerge in

the global marketplace.

In many cases, the company will be

first to reach consumers in emerging

economies and will be first to fulfill an

unmet customer need as a trusted

aggregator of a comprehensive array of

communications and multimedia tech-

nologies as it serves customers directly

through face to face, relationship and

partnership channels. As a VoIP voice

and data communications services

provider, the company will readily

adapt to changing market conditions,

diversify its portfolio of products and

services, and achieve economies of

scale for many of its products by serv-

ing as the underlying carrier.

Igæa’s VoIP technology will prove

competitive, adaptive and, ultimately,

attractive to the consumer in an envi-

ronment of rapid change, and the

Company will receive extensive sup-

port from Cisco to maintain its func-

tional advantage as a services provider

even as new technologies emerge in

the areas of bandwidth provisioning

and alternative forms of telecom con-

duit to include cable, DSL, wireless

broadband and optical networks.

Retail Positioning Strategy

Ethnic Market Segmentation Criteria

a. Ethnicity

b. Spending Patterns

c. Geography (where customers call)

d. Geography (where customers live)

e. Income level

f. Time in country

Affinity Market Segmentation Criteria

a. Passions

b. Hobbies

c. Religion

d. Schools

e. Noble Causes

f. Health

The Target Market

The Company’s ideal customer is an

affluent ethnic residential or small busi-

ness consumer with strong community

affiliation and strong ties to friends and

family abroad.

Such a customer typically places inter-

national calls on a regular basis, has

long-distance usage of $35-$300 per

month, owns his/her own phone and

pays the bill on time.

The dial up nature of most of the

Company’s services will enable the

Company to build brand loyalty and

trust within the ethnic groups it serves

without switching the consumer’s pri-

mary long distance provider.

Igæa is uniquely posi-

tioned to emerge as a

first mover in acquiring

consumer and small

business market share as

a unified communications

services provider

utilizing an underlying

VoIP network.



page 20

INDIA

49¢per minute


ª

¨

No switching!

No monthly fees!

No hidden charges!

Pay only for the minutes you use

Once Igæa fully deploys the VoIP net-

work the Company can then offer

more sophisticated services to its eth-

nic residential customer base through

relationship selling, offering value

added features and volume based dis-

counts particularly to its business and

ethnic SoHo (small office/home office)

users. With the high levels of entre-

preneurial activity among the

Company’s targeted ethnic audience,

this opportunity to upsell to a loyal

customer base will generate significant

revenue growth for Igæa.

The Company will also target high

quality affinity customers and ethnic

affinity customers who belong to the

“mobile middle class,” are well educat-

ed, have friends and family throughout

the United States, and spend $25-$75

per month on long distance. Through

affinity marketing, a portion of these

customers’ long-distance revenues will

go to a charitable cause. The Company

believes that once acquired, affinity

customers will remain loyal, high qual-

ity users.

Customer Acquisition and Retention

Igæa will deliver a higher quality array

of services than its competitors as a

result of the Company’s integrity,

desire to serve, compassion, recogni-

tion of the needs of the ethnic citizen,

and a desire to fulfill those needs with-

out taking advantage of the customer.

The core managers have a profound

familiarity with the ethnic markets and

the international community, as well as

a general desire to provide stream-

lined, innovative products to the

telecommunications marketplace that

are easier to use, more valuable and

ultimately more fun.

Where applicable, the Company will

provide “personalized,” in language,

in-community, agent based, front line

customer service catering to the cus-

tomers’ needs. This business model

will create the intimate feel of a more

“human” company within a given eth-

nic sector even as the company grows

geometrically in the aggregate.

The Company will offer a user friend-

ly, low cost international long distance

alternative to the high cost, impersonal

big three carriers AT&T, MCI/Worldcom

& Sprint. Igæa will deliver a variety of

high quality, VoIP dial around products

and bundled voice and data services

with easy instructions in the customer’s

native language and with access to

friendly, in language customer service

The Company’s ideal cus-

tomer is an affluent eth-

nic residential or small

business consumer with

strong community affilia-

tion and strong ties to

friends and family

abroad.



page 21


1-888-XXX-XXXXigæa

what a good idæa...™

®

options through automated voice

response, live operators, or the

Company’s web portal.

Igæa will deliver low prices, easy and

convenient billing on the local phone

bill or via credit card, valuable incen-

tives for first use and for customer

retention, and tie-ins with community

groups to show support of common

goals and a reciprocal relationship with

the ethnic communities the Company

serves.

The Company’s products will be avail-

able for use on the home phone or

small business phone by third quarter

2000, nationwide. Customers will dial

a local access or nationwide toll free

number, then follow easy in language

instructions to place a domestic or

international call. All calls will be

billed on the local phone bill or via a

pre-arranged credit card agreement.

The Company’s market approach is

one of integrity and openness in its

relationship with its customers. The

Company’s primary international voice

and data termination services have no

monthly fees or hidden charges and

utilize flat rate billing 24 hours a day, 7

days per week. Customers pay only

for the actual minutes they use.

The Company’s goal is to provide eth-

nic consumers the opportunity to make

informed decisions based on honest

and straightforward choices for their

international long distance and other

enhanced voice and data services.

Management believes that the cus-

tomer has the right to complete prod-

uct information and that the variable

calling plans offered by most of the

Company’s competitors are not only

unnecessary, but they are designed

directly to confuse and take advantage

of the customer.

As an honest provider and trusted part-

ner, the Company will have a major

competitive advantage in targeted eth-

nic markets. Trust reduces churn,

increases referrals and opens up

opportunities to market additional

products to customers, all of which will

positively impact the Company’s bot-

tom line.

Management believes that ethnic cus-

tomers will respond favorably to the

Company’s new market vision and

approach to customer relationships.

Igæa will deliver a higher

quality array of services

than its competitors as a

result of the Company’s

integrity, desire to serve,

compassion, recognition

of the needs of the ethnic

citizen, and a desire to

fulfill those needs with-

out taking advantage of

the customer.



page 22

Direct Marketing Channels

The Company’s top managers possess

a proven ability to drive substantial

voice and data revenue through three

distinct sales and marketing channels

consisting of independent contractor

agents; certified resellers; and strategic

media, corporate and affinity partner-

ships.

Igæa’s market entry strategy is com-

prised of a three pronged initiative to

promote a bundled package of voice

and data services to ethnic U.S. and

worldwide consumers utilizing the

above described channels.

Igæa’s VP of Agent Sales has recently

joined the Company after working for

Telegroup where he managed a global

agent network generating over $180

million in annual revenues.

The Company’s VP of Value Added

Services comes to Igæa from Teleglobe

where he personally developed a $110

million block of ethnic based reseller

traffic targeting U.S. based ethnic pop-

ulations.

The Company forecasts $7 million in

agent sales and $3 million in reseller

sales in 2000.

Customer Influence Points Analysis

Primary points of customer contact

• Master Agents and Certified Resellers

• Television advertising campaigns

• Radio

• Print (magazines/newspapers/ethnic

papers)

• Internet banners, internet portals

• Direct mail/Direct Email

• Point of purchase displays

• Billing statements/statement stuffers

• Bank cards, credit cards, ATM cards

• Affinity newsletters

• Event sponsorship

• Word of mouth

Secondary points of contact

• Phone bill

• Company web site

• IVR/800 number

• Outbound telemarketing

• Customer service

• Residual advertising, stickers

The Company’s goal is to

provide ethnic consumers

the opportunity to make

informed decisions based

on honest and straightfor-

ward choices for their

international long dis-

tance and other

enhanced voice and data

services.



page 23

Product Offerings

The company will provide a variety of

voice and data products and services to

include:

• VoIP “packetized” voice [long dis-

tance]

• Interstate and international long dis-

tance

• Dial around/casual dialing [long dis-

tance]

• Prepaid calling [long distance]

• Fax over IP

• Internet access

• Data transmission

• Unified messaging

• Enhanced services to include voice-

mail and information services

• Conference calling

• Calling cards and virtual calling cards

generated via the internet

• International call back

• Internet initiated call back and con-

ference calling (Callnavigator.com)

• Video conferencing and multimedia

distribution

The following are compelling reasons

why customers will use the company’s

products versus those of competitors:

• User friendly, multiple foreign lan-

guage voice prompting and customer

service;

• Substantially lower pricing to target

countries;

• No monthly fees, no signing up;

• No changing of long-distance com-

panies required;

• Convenient LEC billing or credit card

billing and 24 hour internet access to

billing information, rates and other

important product information;

• Calling card type portability;

• Enhanced services such as speed

dialing and conference calling;

• Bundled services such as long dis-

tance, internet access, pre-paid inter-

national inbound calling;

• Referral bonuses to reduce cus-

tomer’s telephone bills in return for

bringing friends to the network;

• Contributions to ethnic communities

and not-for-profit organizations;

• Value added giveaways.

At the core of the Company’s product

offerings will be its VoIP and hybrid

circuit switched calling network.

Several of the company’s products are

based on the “dial in” or “dial around”

concept. In other words, Igæa cus-

tomers will access the company’s state

The Company’s top man-

agers possess a proven

ability to drive substantial

voice and data revenue

through three distinct

sales and marketing chan-

nels consisting of inde-

pendent contractor

agents, certified

resellers, and strategic

media, corporate and

affinity partnerships.



page 24

of the art network and enhanced serv-

ices options by dialing either a seven

digit local access number or an eleven

digit toll free access number.

Customers will then follow easy

instructions in the language of their

choice to place an interstate or interna-

tional call. By offering primarily dial

up access products, the Company

saves literally millions of dollars in net-

work equipment costs and significantly

shortens time to market.

Igæa will manage the seamless integra-

tion of its VoIP and circuit switched

networks such that the customer will

receive the highest quality voice and

data transmissions.

Callnavigator.com

Igæa is developing a web initiated con-

ference call product named

Callnavigator.com (see Appendix).

Callnavigator will enable any customer,

anywhere in the world to set up a two

leg or multi-leg conference call by

easily accessing the Company’s

Callnavigator.com web page. Customers

will register at the site, designate a billing

method and essentially control the

Company’s switch in New York or Los

Angeles to call the various parties on the

call. The web site can be used to instant-

ly generate multi-party conference calls

both domestically and internationally.

All legs of the call are generated from the

U.S. outbound, thus taking advantage of

significant savings versus internationally

initiated calls. The Igæa Callnavigator

product will enable future Web Access

Protocol (WAP) hand held devices such

as the Palm VII and web enabled cell

phones such as those being developed

by Sprint and Nokia to access the power

of the instant international conference

call. A business traveler in Germany, for

example, can initiate a conference call

with multiple parties in multiple foreign

countries at the touch of a button, all

while he is riding in a taxi from the air-

port to his hotel and with the confidence

that he is receiving the lowest possible

rates utilizing Igæa’s VoIP network.

Callnavigator will enable

any customer, anywhere

in the world to set up a

two leg or multi-leg

conference call by

accessing the Company’s

Callnavigator.com

web page.



page 25

Ethnic Marketing

Of the many ethnic groups the

Company plans to serve, Hispanics and

Asians represent large and growing

minority communities within the

United States with communications

spending patterns, geographic living

patterns and target country calling pat-

terns that the Company believes are of

significant value and representative of

the Company’s target market.

Hispanic

The Hispanic population is projected

to grow from 30 million in 1998 to

more than 52 million by 2020 when

Hispanics will account for 16 percent

of the U.S. population.

Hispanics are currently 11 percent of

the U.S. population.

Hispanics will become the largest

minority in 2009, when they will out-

number African Americans.

Among Hispanics, the three largest eth-

nic groups are Mexican (63%), Puerto

Rican (11%) and Cuban (4%).

The Hispanic population

is projected to grow from

30 million in 1998 to

more than 52 million by

2020 when Hispanics will

account for 16 percent of

the U.S. population.



page 26

Hispanic Percentage of Total Population

Non-HispanicWhite72%

Non-HispanicBlack12%

Hispanic11%

Non-HispanicAsian4%

Non-Hispanic�Native Americans

1%

Source: U.S. INS 1996

Hispanic Population by Type

Guatemalan269,000

Colombian379,000

Spaniard519,000

Dominican520,000

Salvadoran565,000

Cuban1,044,000

Puerto Rican2,728,000

Mexican13,496,000

Source: 1990 Bureau of Census

1M

Metro Areas with the Most Hispanics

Metro Area % Pop.

32.9%

14.7%

33.0%

15.5%

10.9%

20.7%

47.4%

13.0%

20.4%

69.6%

Los Angeles

New York

Miami

San Francisco

Chicago

Houston

San Antonio

Dallas

San Diego

El Paso

0 2M 3M 4M

Hispanic Population


Hispanics are most likely to live in the

West (45%) and South (31%). Fifty-eight

percent (58%) of Mexican-Americans live

in the West, while sixty-nine percent

(69%) of Puerto Ricans live in the

Northeast, and seventy-one percent

(71%) of Cubans live in the South.

Hispanics account for twenty-six percent

(26%) of California’s population, and Los

Angeles is home to more Hispanics than

any other metropolitan area in the U.S.

Successful Hispanic ad campaigns tend

to have the following basic elements in

common:

• The campaigns are emotionally driv-

en and talk to the heart.

• The product or service is presented

in simple, familiar and realistic back-

grounds.

• Copy and key messages are simple,

direct and to the point.

• Only one or two product or service

benefits or attributes are communi-

cated and repeated.

• Clear suggestion of price (if applica-

ble, “Not too expensive for you”).

• The campaigns show product, logo

and/or location as needed.

• The campaigns tell a simple story.

There’s a beginning and an end.

Elements in the ad tend to be relat-

ed, not independent juxtaposed

images such as MTV.

Hispanics will become the

largest minority in 2009.



page 27

Hispanic Immigrants Percentage of Total

HispanicImmigrants

OtherImmigrants


42%

Total Immigrants 915,900

Total Hispanic Immigrants 386,431

Hispanic Immigrants by Country of Birth

Mexico163,572

Dominican Rep.39,604

Cuba26,466

Jamaica19,089

Haiti18,386

El Salvador17,903

Colombia14,283

Peru12,871

Guyana9,489

Guatemala8,763


access theworld

Cuba 39¢per minute

Cuba 39¢per minute

No switching!

No monthly fees!

No hidden charges!



ª

¨

Successful television and radio ads

have the following elements in com-

mon:

• The ads repeat the key message or

messages and show the product sev-

eral times during the ad.

• The ads show (or suggest) a particu-

lar person - a mother, father, teenag-

er, baby, child, grandmother, teacher,

bank teller, salesperson - whoever is

appropriate for the product or serv-

ice.

• Talent and people shown in the ads

are “average-looking” Hispanic peo-

ple, not too dark, mestizo or Indian

looking, nor too blond or European-

looking either. These “physiological”

parameters are correlated with social

class; a more light haired/blond

Hispanic is associated with an

“upper-class Hispanic.” There’s much

Hispanic consumer sensitivity in this

area. Consumers in Latin America

tend to prefer the “blond and tall”

image and talent. This is somewhat

different in the U.S. Hispanic market

where class structure is more loose,

and far darker or more “Latin look-

ing” people are successful.

• The ads may show children (happy,

smiling) and talk about motherhood

or fatherhood with tenderness.

• Generally, the ads explain or show

where to find the product or service.

• The ads suggest positive images,

such as smiles, accomplishments,

family members or an improved

quality of life.

• The ads do not show or dwell on

negative images or connotations

unless strictly necessary for the mes-

sage to hit home, such as for drunk

driving or AIDS themes.

• If the visuals or messages are nega-

tive or painful the effect will tend to

be the opposite of the desired one:

denial, low recall, anger and finally,

no action. If the message is portrayed

with positive emotions the response

recall is much higher.

• The pace tends to be somewhat

slower than for general market mate-

rial.

Hispanics account for

twenty-six percent (26%)

of California’s population.



page 28

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¨

Asians

Asian Americans currently represent

four percent (4%) of the U.S. popula-

tion.

The Asian population is projected to

grow from 10.5 million in 1998 to near-

ly 20 million by 2020, when Asians will

account for six percent (6%) of the total

U.S. population.

Asians are much better educated than

the population as a whole. Forty-two

percent (42%) were college graduates

in 1996, versus twenty-four percent

(24%) of the total population.

Except for a few health conditions,

Asians fare much better than the aver-

age American. At birth, life expectan-

cy for Asian males is seven years

longer than average, while for females

it is five years longer.

Asian households are more likely to be

headed by married couples than the

average household - sixty-one (61%)

versus fifty-four (54%) percent. Only

twenty-four percent (24%) of Asian

households are not families. This com-

pares with thirty percent (30%) of

households nationally.

The Asian population is

projected to grow from

10.5 million in 1998 to

nearly 20 million by

2020, when Asians will

account for six percent

(6%) of the total U.S. pop-

ulation.



page 29

300

Metro Areas with the Most Asians

Metro Area % Pop.

9.2%

14.8%

4.6%

63.0%

3.1%

3.7%

7.9%

6.1%

2.5%

3.5%

Los Angeles

San Francisco

New York

Honolulu

Chicago

Washington, DC

San Diego

Seattle

Boston

Houston

0 600 900 1,200

Asian Population [000's]


Asian Immigrants Percentage of Total

AsianImmigrants

OtherImmigrants


33%

Total Immigrants 915,000

Total Asian Immigrants 307,807

Asian Immigrants by Country of Birth

Philippines55,876

India44,859

Vietnam42,067

China41,728

Korea18,185

Taiwan13,401

Pakistan12,519

Iran11,084

Bangladesh8,221

Hong Kong7,834

Japan6,011


The median income of Asian house-

holds fell nine percent (9%) between

1990 and 1995, after adjusting for infla-

tion. Despite this decline, the median

income of Asian households remains

higher than the median income of all

households.

Fifty-three percent (53%) of Asian

households have at least two earners.

This compares with forty-five percent

(45%) of all households and is the

highest proportion among all racial

groups.

Behind the growth of the Asian popu-

lation is immigration. Asia dispatched

thirty-four percent (34%) of all immi-

grants to the U.S. in 1996; the largest

numbers came from the Philippines,

India, Vietnam and China.

Fully sixty-three percent (63%) of

Asians in this country are foreign born,

according to the 1990 census. Asians

with ethnic origin in Vietnam, India

and Korea are most likely to be foreign

born. The Asians least likely to be for-

eign born are those whose ethnic ori-

gin is Japan.

Most Asian Americans speak English

“very well.” Only thirty-eight percent

(38%) of those aged 5 or older do not

speak English fluently. But more than

half of Asians aged 65 or older do not

speak English “very well.”

A great number of Asian Americans

live in the West, where they account

for about thirteen percent (13%) of the

population of the Pacific division.

California is home to about thirty-nine

percent (39%) of the nation’s Asian

population, including fifty-two percent

(52%) of Filipinos and forty-six percent

(46%) of Vietnamese. Los Angeles has

more Asians than any other metropoli-

tan area.

Los Angeles has more

Asians than any other

metropolitan area.



page 30

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Direct Marketing Through Agent Channels

The U.S. has a large number of experi-

enced telecommunications sales agents

that sell independently for a variety of

companies. These agents have estab-

lished customer bases, established mar-

keting methods, and established sales

offices in both the U.S. and worldwide,

and offer a unique opportunity for the

Company to quickly build a retail sales

operation serving the ethnic residential

and business communities in the U.S.

as well as ethnic populations abroad.

Agents offer the Company an effective,

low risk and relatively low cost entry

opportunity into the ethnic market-

place.

Agents incur the initial costs associated

with the marketing, selling and closing

of the customer. Igæa pays commis-

sions to agents only for actual cus-

tomers acquired/revenues generated,

thereby minimizing customer acquisi-

tion costs to the Company.

Since the agent incurs the marketing

expense of acquiring customers, he

also determines the best strategy for

marketing the product within the

Company guidelines. Agents are more

familiar with their intended sales audi-

ence and can penetrate the market-

place more quickly and effectively than

any large company can.

Agents often market “in language” with

sensitivity to cultural idiosyncrasies that

non-natives can not replicate. They

also understand the types of marketing

the intended audience will best

respond to. Igæa will establish proce-

dures and guidelines with agents to

support the company’s goals in terms

of product branding and marketing

image.

The Company has, to date, recruited

twenty-six Master Agents, representing

a potential $20 million in VoIP long dis-

tance revenues.

The Company has, to

date, recruited twenty-

six Master Agents, repre-

senting a potential $20

million in VoIP long dis-

tance revenues.



page 31

Retail Partnership Marketing

The Company will deliver VoIP and data

services to the high profit international

calling market through a variety of tradi-

tional retail channels.

The unique design features of the

Company’s products will allow Igæa to

leverage the power of cooperative media

and marketing relationships in order to

create the appearance and effect of a

multi-million dollar advertising budget

with little up front advertising expense.

The Company will deliver a consistent

marketing message through a variety of

media including television, radio, news-

paper, magazines, web portals, catalogs,

flyers, statement stuffers and various

point of purchase locations, and will fund

this marketing effort by entering into joint

venture agreements with media, corpo-

rate and affinity partners to share long

distance/communications revenues in

lieu of purchasing advertising space

directly from those partners.

The Company’s products lend themselves

to fully scalable, indirect, media-based

revenue sharing. This type of coopera-

tive partnering is essentially unavailable

to the Company’s competitors.

For example, open switch 10-XXX dial

around competitors can not offer revenue

sharing to media partners because of

these companies’ inability to trace a direct

line between marketing dollars expended

and customer usage. Open switch 10-

XXX competitors like 10-10-321 spend

millions of marketing and advertising dol-

lars blindly, hoping that aggregate cus-

tomer usage will generate an overall prof-

it for their services. 10-10-321 cannot

trace customer usage to a particular

advertiser with certainty and therefore

cannot revenue share with those adver-

tisers. On the other hand, the Company

can directly measure customer response

to all marketing efforts by a given media

partner, and can directly compensate

partners for revenues generated their

unique local or toll free access number.

Traditional 1+ competitors can track cus-

tomer acquisition and pay commissions

based on actual subscriptions. However,

this “signing up the customer” paradigm

requires face to face or telemarketing

sales and dedicated sales agents and/or

sales efforts on the part of affiliates. In

contrast, the Company’s products can be

marketed via point to multipoint mass

media. No face to face selling is required,

yet commissions will still result from suc-

cessful advertising campaigns, billing

stuffers, newsletters, point of purchase

displays and other marketing methodolo-

gies.

The Company can directly

measure customer

response to all marketing

efforts by a given media

partner, and can directly

compensate partners for

revenues generated their

unique local or toll free

access number.



page 32




ª

¨

Potential revenue sharing partners

for the Company include:

• Cable television providers or utility

companies looking to bundle telecom

services;

• Individual cable channels looking for

the next successful per inquiry infomer-

cial to provide residual monthly

income;

• Credit card companies interested in

generating profits from billing state-

ments;

• National retailers and member organi-

zations seeking new service offerings;

• Affinity groups searching for new

sources of revenue that are market

driven and require little sales effort, dis-

tribution, maintenance or personnel;

• Newspapers or magazines with rem-

nant advertising space currently going

to waste;

• Independent agents looking for small

business opportunities;

• Internet portals eager to increase adver-

tising revenues through creative deal

structuring.

Igæa will deliver a turn

key package to resellers

consisting of enhanced

VoIP and data services,

billing and collection,

customer service and

back office support.



page 33

Print Catalogs (e.g. Damark, Hello Direct)Newspapers ethnic (Chinese Daily News, Filipino Reporter)Newspapers domestic (USA Today, LA Times)Newspapers alternative (Village Voice, LA Weekly)Magazines (Saludos Hispanos)Directories (Chinese Yellow Pages)

Electronic Radio ethnic (KAZN, KORG)Radio domestic (local affiliates, national syndications)Broadcast TV ethnic (WNJU-TV, KTSF)Cable programming ethnic (CTN, Telemundo)Cable providers (Intermedia, Jones)Satellite providers (DIRECTV, Dish Network)Internet Portals & Content Providers (iVillage, Amazon.com)

Affinity Not for profits (MADD, SMART)Associations (AAA, USAA, AAN)Buying clubs (Sam’s Club, Costco)Universities (Vanderbilt, UCLA)

Corporate Utilities Credit card companies Travel companies Retailers

Further illustration of potential revenue sharing partners includes:

Marketing Through Wholesale Channels

The Company will offer its services to

established industry resellers and

established sales and distribution chan-

nels seeking to expand their product

offerings, who will then privately

brand the product to sell under their

respective company names.

Igæa will deliver a turn key package to

resellers consisting of enhanced VoIP

and data services, billing and collec-

tion, customer service and back office

support.

Resellers will provide the following

functions:

• Resellers will purchase the Igæa

products and services at a designat-

ed, volume based “buy rate,” and set

their own retail rates to charge the

end user;

• Resellers will acquire customers

through their preferred marketing

and sales channels;

• Resellers will print & distribute sales

literature and fulfillment kits;

• Resellers will provide front line cus-

tomer service;

• Resellers will train sub agents;

• Resellers will manage and administer

related business functions.

Igæa will provide the following sup-

port services to resellers:

• Remit reseller net revenue from LEC

remittance;

• Provide customer service to resellers;

• Provide customer service for billing

inquiries to end users;

• Conduct periodic training sessions

for resellers;

• Provide usage reporting to resellers;

• Supply prototypes of sales literature

and fulfillment kits.

Resellers will be responsible for bad

debt. Net revenue to reseller will be

factored by deducting wholesale

minute rate, LEC fees and bad debt

reserve from gross billings. Igæa will

true up bad debt reserve with reseller

in congruence with the LEC true up

process to Igæa.

Resellers are expected to realize 17%-

20% gross margins.

Like agents, resellers typically have a

strong presence in the international

and ethnic communities in the U.S.

The Company projects

that resellers will gener-

ate $3 million in 2000

revenues with 20% antici-

pated growth per quarter.



page 34

Many resellers are agents who have

advanced to the next level of sophisti-

cation in terms of customer acquisition,

customer support and revenue volume.

Other resellers are entrepreneurial

companies offering a variety of prod-

ucts and services of which telecom rep-

resents a portion of their aggregate rev-

enues.

Resellers can be either U.S. or foreign

based. They are typically larger, often

significantly larger than agents, and

commit to purchasing agreements and

additional responsibilities in order to

increase their internal profit margins.

Many of the same issues that affect

agents also affect resellers such as

timely and accurate reporting and back

office support. Igæa will deliver many

of its support services to resellers, as it

does to agents, via the company’s web

site.

The Company projects that resellers

will generate $3 million in 2000 rev-

enues with 20% anticipated growth per

quarter.

Global ClearinghouseOpportunity

In addition to deploying its own IP

gateways, the company is developing

partnering channels for strategic place-

ment of IP gateways pre-configured to

integrate with Igæa’s network intelli-

gence and enhanced services platform.

For example, the Company has identi-

fied opportunities to promote gateway

deployment through an existing base

of global resellers and agents who will

invest in a business opportunity to

offer VoIP to their existing customer

bases by purchasing IP gateways

through Igæa. In this manner the

Company will offer the equivalent of a

franchise opportunity to worldwide

entrepreneurs. Growth will only be

constrained by the number of busi-

nesses the Company is able to contact

and its internal financial resources to

assist as necessary in funding the build-

out of the franchised network.

In addition to deploying

its own IP gateways, the

company is developing

partnering channels for

strategic placement of IP

gateways pre-configured

to integrate with Igæa’s

network intelligence and

enhanced services plat-

form.



page 35

Additional candidates to become Igæa

certified partners include:

• Domestic ISPs that have an existing

customer base and knowledge of the

data and internet industry and would

like to offer voice and other value

added features to their customers

thereby increasing revenues and

profitability;

• Foreign ISPs with similar domain

experience and established cus-

tomers;

• Switched and switchless telecommu-

nications resellers in both the U.S.

and abroad that are interested in

offering VoIP services but lack the

technical experience or financial

resources to deploy their own VoIP

network.

Enterprise SalesOpportunities

Enterprise opportunities in VoIP are

expected to grow rapidly within the

next few years as technology improves

to facilitate seamless integration

between VoIP gateways, corporate PBX

telephone systems and global WANs.

As a first mover in the enterprise arena,

Igæa will deploy its established retail

sales channels to deliver the technolo-

gy that is being developed by Cisco

and others to bring enterprise VoIP into

the mainstream of business telecom-

munications solutions.



page 36

Voice over Internet Protocol(VoIP)

Igæa will build and deploy a worldwide

Voice over Internet Protocol (VoIP) net-

work consisting of IP gateways, routers

and SS7 technology provided by Cisco.

The company will locate IP Gateway “on

ramps” in major metropolitan regions

within the United States and will locate,

co-locate or subcontract IP Gateway “off

ramps” in select termination points

worldwide.

The Company has engaged Neteffect

(Atlanta, Georgia), a professional services

group, to assist with the planning and

deployment of its VoIP network.

VoIP is an emerging technology that con-

verts voice to data and allows voice to be

delivered over traditional data networks.

An IP Gateway is a computer switching

device which contains hardware and soft-

ware components including a digital sig-

nal processor (DSP) to convert analog

voice to data for IP transmission.

Igæa customers will access the compa-

ny’s VoIP network through the compa-

ny’s IP Gateways by dialing either a toll

free number or a seven digit local

access number. In the same manner as

a calling card, customers will hear a

voice prompt which will provide easy

to understand instructions for placing a

call or accessing any of the enhanced

features on the network such as con-

ference calling, voicemail, account

information, customer service, etc.

When the customer has chosen to place

an interstate or international call, a series

of events takes place to connect that call

to the destination telephone number.

Before voice can be transferred over data

lines it must be digitized by the DSP.

Once digitized, voice can be broken into

packets and transferred according to the

same internet protocols as other internet

multimedia and data.

Igæa will build and deploy

a worldwide VoIP network

consisting of IP gateways,

routers and SS7 technolo-

gy provided by Cisco.

Network Deployment and Operations


page 37

InternationalGateways

Network Map Phase I

The digitized packets are delivered to

the IP backbone provider and deliv-

ered to an IP Gateway “off ramp” with

close proximity to the called party.

Data routers provided by Cisco manage

the flow of packets across the network

in accordance with the digital address-

es assigned to each packet at the time

they are initially converted to digital

format.

At the destination IP Gateway, the

packets are reassembled and the data

is converted back to voice as an analog

signal. Finally, the signal must inter-

face with the public switched tele-

phone network (PSTN) usually con-

trolled by the foreign PTT, or in the

case of domestic calls, the incumbent

or competitive local exchange carrier

(ILEC or CLEC) such as Bell Atlantic or

SBC to be delivered the “final mile” to

the called party.

Call routers route the individual pack-

ets but the entire call itself is managed

by softswitch technology developed by

Cisco and its partners. A softswitch is

a sophisticated software application

designed to add network intelligence

to a distributed configuration of IP

routers and gateways. The softswitch

incorporates Signaling System 7 (SS7)

technology to manage call flow and

port capacity and to establish data flow

pathways and to assure optimal trans-

mission quality.

Igæa will deploy a softswitch with SS7

capability to enable the company’s IP

gateways to offer VoIP call manage-

ment and control. Then, once the

Company’s softswitch is installed, the

Igæa network will be capable of rapid

growth in that numerous IP gateway

“boxes” can be configured into the net-

work to supply an unlimited number of

gateways on both a domestic and

international basis.

Igæa will deploy an increasing number

of IP gateways to systematically add

value to its network. Gateways will be

deployed in strategic locations both

domestically and abroad to enable the

company to provide access to its cus-

tomer base in major urban centers in

the U.S. and to enable international ter-

mination in key countries overseas.

The Company has

engaged Neteffect

(Atlanta, Georgia), a pro-

fessional services group,

to assist with the plan-

ning and deployment of

its VoIP network.



page 38

Circuit Switched NetworkUtilization

The Company plans to initially develop

its enhanced services on a traditional

circuit switched network and then to

migrate traffic to the VoIP network as it

becomes operational and after beta

testing has demonstrated that the com-

pany can guarantee point to point

voice quality of service (QoS) to its

customers.

The Company will operate an

advanced telecommunications network

consisting of three or more switches

managed by a Service Control Point

(“SCP”), a network server which con-

trols the processing of each call; inter-

faces between the programmable

switch and various internal and offline

databases; interacts with a Voice

Response Unit (“VRU”), and generates

a Call Detail Record (“CDR”) utilizing

the Company’s customized billing soft-

ware. Calls will be transported over

leased transmission lines and sophisti-

cated network management systems

designed to optimize traffic routing.

The Company’s network will provide

high quality, reliable transmission and

switching. The Company’s network

surveillance capabilities, including self-

diagnostic software, will enable the

Company to anticipate and correct

problems before they result in service

interruption.

Leased Transmission Lines

The Company will lease transmission

lines from a variety of facilities-based

and resale long distance carriers. The

Company will contract with these enti-

ties with terms ranging from twelve to

twenty-four months. The Company

will supplement its leased “on-net-

work” capacity with “off-net” services

from a variety of resale and facilities-

based long distance carriers.

The Company is currently evaluating

co-location opportunities and carrier

pricing from Qwest, Global Crossing,

Level 3 and Williams Communications.

Billing Collections and DataProcessing

The Company believes that accurate

and sophisticated information systems

are critical to growth in the telecom-

munications industry. The Company

will dedicate substantial resources to its

information systems and believes that

the strong growth of its enhanced serv-

ices business will largely be attributa-

ble to the existence of strong partners

in both back office and billing platform

services.

Unlike many purely

technical competitors

and would be carriers,

the Company’s manage-

ment has demonstrated

its ability to generate

significant internation-

ally terminated voice

and data revenue

through proven agent,

reseller and partner

marketing channels.



page 39

The Company’s information systems

will enable the Company to:

• Monitor and respond to the evolving

needs of its customers by developing

new and customized services;

• Provide sophisticated billing informa-

tion that can be tailored to meet the

requirements of its customer base;

• Provide high quality customer serv-

ice;

• Detect and minimize fraud;

• Verify payables to suppliers; and

• Integrate additions to its customer

base.

The Company believes that its network

intelligence, billing and financial report-

ing systems will enhance the

Company’s competitive ability and pro-

vide a platform for future growth and

the expansion of its product line.

The Company’s billing information sys-

tems and services will be provided by a

“LEC clearinghouse.” A LEC clearing-

house processes raw switch data into a

format that can be used by the LECs

(Local Exchange Carriers) to produce

end-user invoices. This data processing

is executed on specially designed com-

puters operating a proprietary software

program. The clearinghouse receives

the Company’s raw call records directly

from the Company’s SCP. The calls are

then rated according to standard rates

or according to customer specific rates,

if applicable. Rated calls are sorted

depending on which LEC will actually

bill the end user and then placed in an

industry standard format (“EMI”). The

clearinghouse prepares management

reports which provide the Company

with the total number of calls, minutes

and dollars billed during that bill cycle.

The Company is currently negotiating

billing and collection agreements with

Billing Concepts (formerly USBI), the

leading billing company in the industry

and the clearinghouse for AT&T’s 10-

10-345 (Lucky Dog).

Billing Concepts has existing agree-

ments with all of the Local Exchange

Carriers (LECs), including all of the

Regional Bell Operating Companies

(RBOCs) that cover approximately

ninety-six percent (96%) of the

switched access lines in the U.S. These

agreements will permit Igæa to place its

customers' call detail records on the

customers' regular monthly local phone

bill. In addition, by billing through the

LECs, the Company benefits from the

LECs extensive collections infrastruc-

ture.

The Company will lease

transmission lines from a

variety of facilities-based

and resale long distance

carriers.



page 40

Customer Service

The Company recognizes that excellent

customer service is indispensable to

any enterprise that aspires to be a mar-

ket leader. However, Igæa further sub-

scribes to the belief that its extraordi-

nary customer service will in itself be a

point of distinction relative to its com-

petitors as part of a larger customer

relationship management strategy.

Indeed, the quality of the Company’s

customer care will be a chief driver of

its success.

Our Customer Service strategy is built

around two convergent concepts:

1. Employing world-class Customer

Service personnel, and fortifying

their quality through continual train-

ing, monitoring and manager feed-

back;

2. Employing cutting-edge call center

technology to enhance our customer

relationship management.

I. Call Center Operations

Customer Service Representatives

(CSRs) will be available from 8 a.m. - 6

p.m. CST Monday through Friday, and

from 9-3 Saturdays.

CSRs will answer marketing inquiries

generated by the Company’s marketing

campaigns, as well as support existing

customers. CSRs will offer multilingual

capability in answering a broad range

of inquiries from prospective cus-

tomers relating to service, pricing and

optional or enhanced product features.

The Company’s services are generally

self explanatory, but, the Company

anticipates customer inquiries from

approximately five percent (5%) of

new users. First level billing inquiries

will be handled separately by repre-

sentatives of the LEC clearinghouse

who are available 24 hours per day.

The Company estimates billing

inquiries to equal .3% of total calls.

CSRs will use the Company’s cus-

tomized software which delivers

prompt access to accurate, up-to-date

customer account information. This

customized software is a powerful

database which will provide CSRs the

ability to respond swiftly to customer

needs. CSRs will be able to issue cred-

its, log service trouble tickets, record

pertinent customer information into an

account memo field to maintain cus-

tomer history, enter new customers

into the database and assign appropri-

ate billing codes.

The Company is currently

negotiating billing and

collection agreements

with Billing Concepts (for-

merly USBI), the leading

billing company in the

industry and the clearing-

house for AT&T’s 10-10-

345 (Lucky Dog).



page 41

II. Virtual Call Center Capabilities

The Company’s Customer Service

Center will rely on Intelligent Contact

Management (ICM) capabilities sup-

plied by Cisco and its recently acquired

company GeoTel. ICM-enabled func-

tions include:

a. Pre-routing of calls based on the

caller’s phone number (ANI), allowing

calls to be electronically directed to the

appropriate CSRs before the customer

speaks to a live person, e.g., with

regard to language requirements, VIP

designations (e.g. high volume callers

with billings in excess of $X per

month are placed in separate call

queues), etc.

b. Geography-independent CSRs will be

organized according to function, serv-

ice offering or skill set, rather than by

geographic location. Calls are auto-

matically routed to the best available

agents regardless of location. Thus,

call agents can be stationed anywhere

inside or outside of the physical space

of the Company.

c. CTI (computer telephony integration),

will allow CSRs to have all relevant

customer history pop up on their

screen before they initiate a live-dis-

cussion with the caller (eliminating the

need for customers to verbally re-state

their account numbers two or three

times, and the need for customers to

wait while CSRs call up their records).

d. Harnessing the convergence of IP

technology will give customers media-

independent access to the company.

Example: Customers phoning into a

call center might be given a Web page

address that allows a customer-care

representative to take control of their

browser in order to provide detailed

assistance. Customers will also be able

to send e-mail messages to the cus-

tomer-care center requesting callback.

IP-based call centers will use fax, voice

mail and e-mail, giving customers a

wider range of options for interacting

with the Company.

Igæa believes that

extraordinary customer

service will distinguish

the Company relative to

its competitors as part of

a larger customer rela-

tionship management

strategy.



page 42

Key Network Characteristics

Among the many different types of

standardized data networking technolo-

gies such as X.25, SNA, Frame Relay,

ATM (Asynchronous Transfer Mode),

TCP/IP, Novell IPX, and TDM (Time

Division Multiplexing), only Frame

Relay, ATM, TCP/IP and TDM, along

with proprietary technologies, do well

carrying voice. The key characteristics

a data network must have to carry voice

well are low delay, predictable delivery

of the voice information, a means of

prioritizing the voice traffic ahead of

data, and high enough efficiency to

carry the extra voice traffic.

Frame Relay, ATM and TCP/IP achieve

high efficiency ratings by collecting the

data to be transmitted into packets

(like envelopes) and only sending

them when they are reasonably full. By

not sending empty or nearly empty

envelopes, waste is minimized.

TCP/IP Networking

TCP/IP is a common networking tech-

nology made popular by the Unix

computer operating system and the

Internet. It is now available across vir-

tually all operating systems and is

widely used by many enterprises for a

variety of applications. In fact, there

are estimates that upwards of 90% of

the corporate world is using TCP/IP,

with similar figures for governmental

and educational sectors. Any network

that connects to the Internet must run

TCP/IP, and the Internet is growing

rapidly.

TCP/IP is, specifically, a data commu-

nications protocol. A protocol is a set

of agreed-upon conventions or stan-

dards for interactive behavior.

Communications protocols define how

two devices on a network are to

behave when communicating with

each other; when to talk (send), when

to listen (receive), for how long, how

to correct errors, the proper way of

addressing each other, etc. The various

aspects of a communications protocol

are divided into layers of activity,

where each higher layer builds on the

foundation of the lower layers.

For example, the bottom layer desig-

nates the physical communications

medium such as copper wire, fiber

optic cable, microwaves, satellite, etc.

The next layer specifies the electrical

or optical signaling conventions for the

medium. The “stack” of layers can go

up to layer 7, where the behavior of

the actual user application, such as e-

mail or web browsing, is specified.

The term “TCP/IP” is named for a com-

bination of layer 4 (TCP) and layer 3

(IP) of the so-called “IP” stack. “TCP”

Ninety percent of the

corporate world will be

using TCP/IP by 2000,

with similar figures for

governmental and educa-

tional sectors.



page 43

means Transport Control Protocol, and

“IP” means Internet Protocol. All so-

called “IP networks” use IP at layer 3;

most also use TCP at layer 4.

For IP networks (and several others),

the communications device that man-

ages the network layer is called a

router. Routers are layer 3 datacom

devices responsible for routing data

from one end of a network to the

other. VoIP applications assume a

router-based IP data network support-

ing TCP. In a VoIP network, the IP

layer can ride over a mixture of differ-

ent layer 2 and 1 protocols. It is also

quite possible, for example, to have IP

running on frame relay on ATM over,

say, copper, microwave or satellite.

Three Types of IP Networks

It is convenient to group all IP net-

works as one or a combination of these

three basic types: the Internet; the cor-

porate or Enterprise IP network, some-

times called the Intranet; and the IP

Virtual Private Network (IP-VPN),

sometimes called the Extranet. Some

IP networks are made up of all three

types. The Internet and its World Wide

Web are probably the most prominent,

but for VoIP, the other two are equally

important.

An IP network consists of two or more

IP gateways connected together by a

WAN. The WAN typically supports IP

over leased lines, public frame relay,

ATM, satellite or ISDN connections. In

a managed IP network, data movement

between sites is done expeditiously

with low delay and high predictability.

This is in contrast to the Internet,

where delays can be large and arrival

times highly unpredictable.

The IP-VPN (IP-Virtual Private

Network) is a fairly new type of public

network offering, intended to provide

the managed IP network characteristics

that a VoIP provider needs. It can be

thought of as an “industrial strength”

Internet. Because IP-VPNs are built

with plenty of bandwidth and high-

speed routers, delays are low and

arrival times are predictable.

Igæa has developed a

partnership with one of

the leading providers of

IP telephony switches,

Cisco, and will deploy a

VoIP network utilizing

Cisco equipment over an

underlying domestic IP or

ATM backbone.



page 44

An IP network becomes a viable com-

mercial option when interfaced with

the public switched telephone network

(PSTN) to enable point to point con-

nectivity from anywhere to anywhere

in the world. To inter-operate with the

PSTN (or plain old telephone system -

POTS), an IP telephony switch must

support the Signaling System 7 (SS7)

protocol, either on-board or via an off-

board internetworking device. SS7 is

used to efficiently set up wireless and

wireline calls in the PSTN and to query

PSTN database servers (e.g., to deter-

mine the destination telephone num-

ber associated with a locally ported

number or a toll-free (800/888/877)

call). The support of SS7 by IP teleph-

ony switches represents a critical step

in the integration of the PSTN and IP

data networks.

The Public Switched Telephone

Network provides users with dedicat-

ed, end-to-end circuit connections for

the duration of each call. Circuits are

reserved between the originating

switch, tandem switches (if any) and

the terminating switch based on the

called party number. The PSTN also

provides access to Intelligent Network

services using the Signaling System 7

protocol. SS7 is used for basic call

setup, management and tear down,

and to query databases which support

Intelligent Network services such as

local number portability, mobile (cellu-

lar) subscriber authentication and

roaming, virtual private networking,

and toll-free (800/888/877) service.

Unlike the circuit-switched PSTN,

packet-switched IP networks provide

virtual circuit connections between

users. Bandwidth is shared for

improved utilization of network capac-

ity, leading to lower costs for network

users. Packets are routed to the desti-

nation IP address contained within the

header of each packet and may travel

over separate network paths before

arriving at their final destinations for

re-assembly and re-sequencing. The

transmission speed between any two

users can change dramatically based

on the aggregate bandwidth require-

ments of the users sharing the common

transmission medium.



page 45

Because of the popularity of the

Internet, many public telecommunica-

tions networks now carry significantly

more IP data traffic than voice traffic.

Public telecommunications networks,

optimized for voice traffic, are ill-

equipped to handle increasing data

traffic volumes. The growth in IP traf-

fic coupled with customer demands for

integrated voice and data services at

lower costs has led to the adoption of

IP as the preferred protocol to carry

both voice and data in the public

telecommunications network in the

future.

Igæa has developed a partnership with

one of the leading providers of IP

telephony switches, Cisco, and will

deploy a VoIP network utilizing Cisco

equipment over an underlying domes-

tic IP or ATM backbone.

Igæa customers will access the

Company’s VoIP network by placing

either a local access call or toll-free

access call to one of the Company’s IP

gateways, co-located at points of pres-

ence (POPs) in major metropolitan

areas. The customer will be greeted by

an interactive voice response platform

(IVR) prompting the customer to dial

additional numbers to complete the

call and offering enhanced services.

The 64 kilobit analog voice call is con-

verted to digital packets by the Cisco

gateway digital signal processor. Once

packetized, the voice data can be trans-

mitted across an IP or ATM backbone

to the destination IP gateway where

the signal is converted back to analog

to interface with the PSTN. For inter-

national termination, the Company will

integrate its IP network with other

international VoIP carriers through

peering arrangements at select hubs

such as 60 Hudson Street, N.Y. or 1

Wilshire Blvd., Los Angeles.

Igæa has chosen the Cisco gateway for

a variety of reasons including scalabili-

ty, the anticipated capability of recog-

nizing voice or modem dial up on the

fly, and Cisco’s outstanding reputation

as a leading provider of technology to

the data and telecommunications

industries.

Cisco also offers Igæa the ability to

partner with synergistic providers of

VoIP capacity in foreign countries to

provide point to point termination

capability for Igæa international calls.

Igæa customers will

access the Company’s

VoIP network by placing

either a local access call

or toll-free access call to

one of the Company’s IP

gateways, co-located at

points of presence (POPs)

in major metropolitan

areas.



page 46

Competition


page 47

Internet Telephony CompetitionRevenues (estimates) Market Cap

Projected Revenue Market Valuation1999 2000 2001 IPO 4-11-00

Net2Phone $47M $65M $141M $1.25B $2.8B

Deltathree 11M 31M 64M 799M 436M

iBasis 19M 40M 101M 1.2B 1.17B

ITXC 25M 70M 205M 1B 1.9B

GRIC 10M 25M 65M 372M 496M

Other Competitors

International Focused LD CompetitorsStartec

RSL COM

Teleglobe

Primus

Destia

IDT

10-1-XXXX CompetitorsMCI/Worldcom 10-10-321

10-10-220

Telco 10-10-457

10-10-297

Vartec 10-10-811

10-10-636

AT&T 10-10-345

Qwest 10-10-432

Competition in the market for enhanced IP communications services and carrier

transmission services is becoming increasingly intense and is expected to increase

significantly in the future.

Igæa’s CompetitiveAdvantages

Partnerships with Industry Leaders

The Company is developing strong

relationships with committed equip-

ment and services providers such as

Cisco, NetEffect, and Billing Concepts

who will offer the technical expertise

and quality of service necessary to

enable Igæa to compete with all other

communications providers in terms of

state of the art technology, time to mar-

ket and reliability of service. Igæa’s

network assets will seamlessly integrate

with PSTN and VoIP networks globally

and will enhance the Company’s mar-

ket valuation in the event of a takeover

opportunity by a larger carrier.

Sales and marketing expertise

Unlike many purely technical competi-

tors and would be carriers, the

Company’s management has demon-

strated its ability to generate significant

internationally terminated voice and

data revenue through proven agent,

reseller and partner marketing chan-

nels.

The Company’s founders and core

managers have extensive industry con-

tacts and revenue generating “direct to

consumer” organizations eagerly await-

ing the launch of the Company’s prod-

uct line. In addition, the cooperative

marketing opportunities available to the

Company through its partner marketing

channels will create instant access to a

wide range of superior ethnic distribu-

tion opportunities at a fraction of the

cost of traditional advertising.

With its distribution channels in place,

the Company becomes a formidable

competitor leveraging the power of its

agents, resellers, media, corporate, and

other established marketing partners to

achieve penetration and saturation of

its target audience. The Company fore-

sees access to broad-based consumer

markets, loyal affinity markets, and pre-

viously untapped niche markets, such

as under-served ethnic groups, through

these strategic distribution channels.

Industry knowledge

Management’s experience in the long

distance industry as successful long dis-

tance marketers, product developers

and implementers has enabled and will

enable the Company to identify and

quickly act upon opportunities that

competitors have not identified or

responded to. Both the founders and

the core managers bring a wealth of

experience to the Company including

corporate, entrepreneurial, legal and

financial. In addition, the Company has

identified and will continue to identify

experts, consultants and advisors in the

industry to help guide the Company to

achieve maximal valuation and oppor-

tunity for growth.

The Company is devel-

oping strong relation-

ships with committed

equipment and services

providers such as Cisco,

NetEffect and Billing

Concepts who will offer

the technical expertise

and quality of service

necessary to enable

Igæa to compete with

all other communica-

tions providers in terms

of state of the art tech-

nology, time to market

and reliability of serv-

ice.

Competition


page 48

Shortened timelines, reduced costsand increased adaptability

The Company’s intention to outsource

critical logistical components saves

time in getting to market and allows for

adaptability to take advantage of more

cost competitive opportunities should

they arise. Also, the Company will

minimize hiring costs, staff turnover,

and management expense through

subcontracting.

General overhead savings

The Company’s distributed architecture

approach to the deployment and main-

tenance of its network assets signifi-

cantly reduces overhead costs for this

opportunity and allows for the majori-

ty of invested capital to be directed to

elements of productivity such as sales,

marketing and customer service, while

leveraging the extensive and generous

credit facilities of Cisco and other com-

mitted vendor/partners for asset

deployment and development.

Management is confident the Company

will optimize growth through more

efficient and creative sales, marketing

and corporate management strategies

than the Company’s competitors.

Partnership Opportunitieswith Competitors

While a variety of companies are build-

ing extensive global VoIP networks,

certain competitors represent unique

partnership opportunities.

For example, Nortel Networks and BT’s

Spanish subsidiary are building an

Internet telephony and multimedia net-

work in Spain, a 51-node IP network

with more than 10,000 ports to service

more than 1,300 corporate customers.

This new network may provide inter-

operability with the Company’s domes-

tic IP network as well as the

Company’s future expansion into

Spain. By partnering with BT, Igæa

can extend its IP reach into areas of

Spain it might otherwise have insuffi-

cient resources to develop.

The potential for both competition and

partnership is expansive. Cisco has

access to a variety of ISPs seeking to

become ITSPs and to offer VoIP to their

customers. While the Company may

view these other Cisco customers as

potential competitors, a superior strate-

gy would be to partner with Cisco to

offer VoIP access on a wholesale basis

to these ISPs with Igæa serving as a

clearinghouse utilizing its distributed

network and softswitch network intelli-

gence technologies.

Management is confident

the Company will opti-

mize growth through

more efficient and cre-

ative sales, marketing and

corporate management

strategies than the

Company’s competitors.

Competition


page 49

Even companies such as Startec that

are offering dial around services to eth-

nic communities while building a glob-

al IP telephony network and clearing-

house, provide opportunity to Igæa.

Startec both buys network capacity

from tier 1 carriers and sells network

capacity to those carriers. In the

emerging world of VoIP, Startec will be

as likely to interoperate with Igæa to

achieve termination in areas where

they have no points of presence as

they will be likely to offer termination

to Igæa in those areas where they are

deployed.

The open standards of the VoIP tech-

nologies being produced by compa-

nies such as Cisco, Lucent, Clarent and

Nortel will insure interoperability and

peering of IP carriers to enhance rapid

growth and ultimately consolidation of

the successful players in the industry.

No single player can go it alone in this

emerging interconnected universe of

communications technology. Con-

sequently, the successful competitors

have agreed in principle to cooperate

in order to create open, non-propri-

etary standards as well as to share

capacity and network intelligence in an

environment where partnership is

rewarded over isolationist behavior.

Competition


page 50

An investment in the Company involves

a high degree of risk and should be

regarded as speculative. As a result, the

purchase of equity in the Company

should be considered only by persons or

entities who can afford a loss of their

entire investment. This business plan is

provided for purposes of information

and evaluation only. It does not con-

stitute an offer to sell, or a solicitation

of securities, offers to buy or any other

interest in the business. Any such offer-

ing will be made only by appropriate

documents and in accordance with

applicable State and Federal laws.

Prospective investors should carefully

consider, in addition to matters set

forth elsewhere in this document, the

risk factors described below relating to

the business of the Company.

Limited Operating History;Negative Cash Flow

The success of the Company cannot be

guaranteed or accurately predicted.

There is no assurance that the Company

will be able to operate its services prof-

itably. Such prospects must be consid-

ered in light of the risks, expenses and

difficulties frequently encountered in the

establishment of new technology and a

new product in an emerging market in

an evolving industry.

The Company has a limited operating

history. The Company began operations

in October 1998 and to date has gener-

ated no revenues. There is no assurance

that the Company will be able to oper-

ate on a profitable basis or that cash

flow from operations will be sufficient to

pay the operating costs of the Company.

There is no assurance that the

Company’s estimate of its reasonably

anticipated liquidity need is accurate or

that new business developments or

other unforeseen events will not occur

that will result in the need to raise addi-

tional funds. In the event that the

Company cannot raise needed capital, it

will have an adverse effect on the

Company.

The Company expects to incur signifi-

cant operating losses and to generate

negative cash flow from operating activ-

ities during its first twenty-four months

of operations, while it develops its prod-

uct line and builds a customer base.

Risk Factors


page 51

Significant CapitalRequirements

The Company’s capital requirements

are significant. The Company is

dependent upon the financing pro-

ceeds to fund the cost of development

and to market the Company’s commu-

nications services. The Company

anticipates that the net proceeds of the

fully subscribed Offering will be suffi-

cient to satisfy the Company’s cash

requirements for eighteen to twenty-

four months. However, in the event

the Company’s plans change, its

assumptions change or prove inaccu-

rate, or if the net proceeds of the

Offering or other capital resources and

projected cash flow prove to be insuf-

ficient to fund operations, the

Company will be required to seek

additional financing.

The Company has no current arrange-

ments with respect to sources of addi-

tional financing, and there can be no

assurances that the Company will be

able to obtain additional financing on

terms acceptable to the Company. To

the extent that any such financing

involves the sale of Company equity,

the interests of the Company’s then

existing members could be substantial-

ly diluted.

Uncertainty of New ProductDevelopment

The research and development related

to the Company’s product variety of

enhanced services communications

products has not been completed, and

accordingly, no revenues therefrom

have been generated. The Company

will be required to devote substantial

resources to develop its products.

Technological Risks and Risksof Obsolescence

The telecommunications industry is

constantly changing. Technological

obsolescence of the Company’s prod-

ucts and underlying equipment

remains a possibility. Competing long

distance and VoIP communications

providers currently offer and are devel-

oping similar products which may

dilute the success of the Company.

There is no assurance that the com-

petitors of the Company will not suc-

ceed in developing related products or

using similar processes and marketing

strategies prior to the Company, or that

they will not develop technology and

products that are more effective than

any which are being developed by the

Company.

Risk Factors


page 52

Need for Complex Nationaland International Marketingand Sales

The successful execution of the

Company’s business plan entails mar-

keting, brand development and sales

on a national and international basis.

There is no guarantee that the

Company will be successful in manag-

ing a complex strategy of marketing

and sales to effect a reasonable pene-

tration of its products and services into

its target markets on a timely basis.

Reliance on StrategicPartnerships

The Company will derive a significant

portion of its revenues from the mar-

keting exposure provided by the

Company’s strategic partners. The

Company’s ability to generate retail

revenues will depend upon, among

other factors, its ability to procure

media exposure on a revenue sharing

basis as opposed to traditional media

buying. There is no assurance that the

Company will be successful in devel-

oping such strategic partnerships on a

timely basis, or of developing enough

strategic partnerships to successfully

market the Company’s products, in

spite of early indications of promise.

Substantial Dependence UponThird Parties

The Company is in an early stage of

development and has yet to finalize

comprehensive internal management,

personnel and other resources. The

Company depends substantially upon

third parties for several critical ele-

ments of its business including, among

others, promotion and marketing, tech-

nology and infrastructure develop-

ment, billing, fraud control, network

provisioning and customer service.

Dependence Upon KeyPersonnel

The success of the Company will large-

ly depend upon the personal efforts of

certain key personnel. The Company

anticipates entering into employment

and consulting agreements with other

key personnel. Competition among

telecommunications companies for

qualified employees is intense, and the

loss of key personnel or the inability to

attract and retain the additional highly

skilled employees required could

adversely affect the Company’s busi-

ness.

Risk Factors


page 53

Financial Information andForecasts

The Company has limited operating

history. The Company is the sole pre-

parer of the financial information and

forecasts set forth herein. Such finan-

cial forecasts are prepared as of the

date of this document and are based

on the Company’s current best estimate

of the results it expects for the

Company as described herein. The

financial information is not necessarily

prepared or presented according to

generally accepted accounting princi-

ples and does not include end of peri-

od adjustments or complete footnotes.

The Company does not intend to

update or otherwise revise the financial

forecasts to reflect events or circum-

stances existing or arising after the date

of this document or to reflect the

occurrence of unanticipated events,

except as required by applicable law.

None of the financial information and

tables and forecasts has been exam-

ined, compiled or reviewed or is based

on agreed-upon accounting proce-

dures applicable to financial forecasts.

The financial forecasts necessarily are

based upon a number of estimates and

assumptions that, while presented with

numerical specificity and considered

reasonable by the Company, are inher-

ently subject to significant business,

economic and competitive uncertain-

ties and contingencies, many of which

are beyond the control of the

Company, and upon assumptions with

respect to future business decisions

which are subject to change. The

financial forecasts assume, among

other things, that the Company will be

successful. The success of the

Company is subject to uncertainties

and contingencies beyond the

Company’s control. Accordingly, there

can be no assurance that the forecast-

ed results will be realized.

The financial forecasts and actual

results will vary, and those variations

may be material. The inclusion of the

financial forecasts herein should not be

regarded as a representation by the

Company or any other person that the

financial forecasts will be achieved.

The financial forecasts were not pre-

pared with a view toward public dis-

closure or complying with SEC pub-

lished guidelines. Any prospective

investor in the Company is cautioned

not to place undue reliance on the

financial forecasts.

Risk Factors


page 54

Government Regulation:Legislative Risk Factors

The Company is currently subject to

direct regulation by the Federal

Communications Commission (FCC)

which exercises jurisdiction over all

facilities of, and services offered by

telecommunications common carriers

to the extent that they involve the pro-

vision, origination or termination of

interstate or international communica-

tions.

If at some time in the future the

Company offers intrastate long distance

service, the Company will be subject to

regulation by various state public serv-

ice commissions (PSC), public utility

commissions (PUC), and/or state regu-

latory authorities which retain jurisdic-

tion over intrastate communications.

The Company has obtained FCC

authority to provide interstate and

international services through the

resale of switched services of various

carriers. The FCC has classified the

Company as a non-dominant inter-

exchange carrier.

As a non-dominant carrier, the

Company may provide domestic inter-

state communications without prior

FCC authorization, although FCC

authorization is required for the provi-

sion of international telecommunica-

tions by non-dominant carriers.

Non-dominant carriers currently are

required to file tariffs listing the rates,

terms and conditions of interstate and

international services provided by the

carrier. However, generally the FCC

has chosen not to exercise its statutory

power to closely regulate the charges

or practices of non-dominant carriers.

Nevertheless, non-dominant carriers

are required by statute to offer inter-

state and international services under

rates, terms and conditions that are

just, reasonable, and not unduly dis-

criminatory and the FCC acts upon

complaints against such carriers for

failure to comply with statutory obliga-

tions or with the FCC’s rules, regula-

tions and policies.

The FCC also has the power to impose

more stringent regulatory requirements

on the Company and to change its reg-

ulatory classification. The Company

believes that, in the current regulatory

environment, the FCC is unlikely to do

so. The FCC also imposes prior

approval requirements on transfers of

control and assignments of operating

authorizations.

The FCC has the authority to generally

condition, modify, cancel, terminate or

revoke operating authority for failure

to comply with federal laws and/or the

rules, regulations and policies of the

FCC. Fines or other penalties also may

be imposed for such violations.

Risk Factors


page 55

There can be no assurance that the

FCC or third parties will not raise issues

with regard to the Company’s compli-

ance with applicable laws and regula-

tions. The Company has engaged FCC

legal counsel to assess the extent to

which the FCC and other governmental

regulations may impact the proposed

business of the Company. However,

the long distance industry is subject to

continually evolving regulation. There

are a number of issues on which regu-

lation has been or in the future may be

suggested. As new regulations are

promulgated, the Company may be

required to modify its business plan or

operations in order to comply with

such regulations. There can be no

assurances that the Company will be

able to do so in a cost-effective man-

ner, if at all.

Competition

The Company expects that competition

from companies both in the Internet

and telecommunications industries will

increase in the future. Many existing

competitors and potential competitors

have longer operating histories, broad-

er portfolios of services, greater finan-

cial, management and operational

resources, greater brand-name recogni-

tion and customer loyalty, larger sub-

scriber bases and more experience.

If Igæa is unable to provide competi-

tive service offerings, it may lose exist-

ing users and be unable to attract addi-

tional users. In addition, many com-

petitors enjoy economies of scale that

can result in a lower cost structure for

transmission and related costs, which

could cause significant pricing pres-

sures within the industry.

The Company recognizes that a variety

of one and two tier long distance and

VoIP carriers offer enhanced communi-

cations services to the ethnic commu-

nities in both in the United States and

abroad.

Risk Factors


page 56

The market for enhanced Internet and

IP communications services is new and

rapidly evolving. The primary compet-

itive factors determining success in the

Internet and IP communications mar-

ket are:

• quality of service;

• the ability to meet and anticipate cus-

tomer needs through multiple service

offerings;

• responsive customer care services;

• price.

Future competition could come from a

variety of companies both in the

Internet and telecommunications

industries. Many companies provide, or

are planning to provide, certain por-

tions of the complete communications

solution including Net2Phone and

JFAX.COM.

Several traditional telecommunications

companies, including industry leaders

such as AT&T, Sprint, Deutsche

Telekom, MCI WorldCom and Qwest

Communications International, have

recently announced their intention to

offer enhanced Internet and IP com-

munications services in both the United

States and internationally. All of these

competitors possess:

• substantially greater financial, techni-

cal and marketing resources;

• larger networks;

• a broader portfolio of services;

• stronger name recognition and cus-

tomer loyalty;

• well-established relationships with

many of our target customers;

• an existing user base to which they

can cross-sell their services.

These and other competitors may be

able to bundle services and products

with enhanced Internet and IP commu-

nications services, which could place

the Company at a significant competi-

tive disadvantage. Many competitors

enjoy economies of scale that can

result in lower cost structure for trans-

mission and related costs, which could

cause significant pricing pressures

within the industry.

Risk Factors


page 57

Primary competitors in providing carri-

er transmission services include:

• long distance carriers, including

AT&T, MCI WorldCom and Sprint

Corporation;

• foreign carriers, including British

Telecom, Deutsche Telekom and

Nippon Telegraph and Telephone

Corporation;

• global telecommunications alliances,

including Global One and BT/AT&T;

• emerging carriers providing transmis-

sion services over the Internet,

including ITXC Corp., iBasis and

AT&T Global Clearinghouse;

• wholesale carrier providers, includ-

ing STAR Telecommunications, Inc.

and Pacific Gateway Exchange.

Competition for carrier traffic is prima-

rily based on price. Decreasing

telecommunications rates have resulted

in intense price competition. The

Company expects that competition will

continue to increase significantly as

telecommunications rates decrease.

Increased competition could reduce

prices and profit margins, and may

reduce market share.

Risk Factors


page 58

The Company believes it

will compete favorably in

its targeted markets due

to its experienced man-

agement, strong industry

relationships, innovative

products, unique sales

and marketing strategy,

customer retention strat-

egy, competitive pricing,

high network quality,

reduced costs and pas-

sionate dedication to pro-

viding a superior telecom-

munications experience

to the communities and

customers it serves.

For more information contact: Kirk Rittenhouse Manz, CEO

Igæa

119 Windsor Drive

Nashville, Tennessee 37205

E-mail [email protected]

Telephone 615/353-9737

Facsimile 615/353-9521

Date post:	02-Dec-2014
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Sample Business Plan

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