SOURCES AND USES OF FUNDS

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SOURCE OF FUNDS
Common Stock Purchase (Investor) $100,000
$ 6,000,000 Note Payable to Investor 4,750,000
Total Sources of Funds $4,850,000
Uses of Funds (Year 1 – Prototype Development and Validation):
Corporate and LLC formation and meetings – travel 8,000
Legal review, LLC and Corporate Formation 10,000
Consulting Fee for Investment Marketing 250,000
Escrow set-up and closure 2,000
Total Initial Uses of Funds $ (270,000)
Prototype Development Uses:
Terra Sonic International – Sonic Drill and Components:
TSi 150CC Compact Crawler Rig $610,000
APHS (auto pipe handling sys with track mod) 60,000
Adapter, TSi Head Flange to TSi Spindle x 2 3,000
Rod (4.25”OD x 3.75”ID), 600’ w/6”x 4.25” spindle 57,000
8” Core Barrel x 3 5,000
8” Core Barrel Bits x 10 6,000
4.25” x 8” Core Barrel Adaptor x 4 6,000
Casing (9.25”OD x 8.4”ID x 10’) x 600’ 112,000
9.25” Casing Shoe Bits x 10 6,000
6” x 9.25” Casing Adaptors x 3 5,000
Sonic Crew Special Training (3 weeks) 30,000
Trucking – to Grants Pass, Oregon 100,000
Total Sonic Rig Investment (1,000,000)
Research and Development (e.g. Eductor Rod Couplings, Adaptor Vanes, Jetting Sub-Couplings, Heat Manifold,Manufacturing, Engineering, Professional Services (300,000)
Processing Plant and Ancillary Equipment:
Jet Pump with Driver and Pump Smart VFD with Accessories (e.g. Platform and Conduit) 330,000
Processor (e.g. Centrifugal Concentrator, Pumps, Backfill Apparatus, Conduit) 300,000
Grinder (e.g. 30tph) of Slurry 20,000
Water Filtration Unit (e.g. Bonchar, Zeolite) 50,000
Gold Room (e.g. MSI 255 Shaking Table / 755 Enhancer with Facility/RV, Security) 100,000
Reservoir (e.g. Tank, Dam, Pump, Well Structures, Well Pump) 100,000
Total Processing Plant and Equipment (900,000)
Subtotal “Uses” (2,470,000)
Other Equipment:
Scientific Analysis Technology:
XRF Hand-Held Spectrometer, Training, Data Collection Software, Core Holders, Validity Fees $50,000
Seismic and/or LIDAR integration 60,000
Other 40,000
Total (150,000)
Heavy Equipment:
Compact 299D Caterpillar Track Loader with Accessories 120,000
D4 or Equivalent Small Dozer 60,000
Morooka with Trailer/crane for Rods, Casing, Tools and Equipment 130,000
Total (310,000)
Facilities and Transportation:
Mining Tent and Mobile Facility Structures 70,000
RV Living Quarters x 2 50,000
ATV’s x 2 8,000
Haul Trailers x 2 30,000
Containers x 2 12,000
Other 30,000
Total Facilities and Transportation (200,000)
Administration, Supplies, Permits, Insurance, Payroll (Annual Expense):
Payroll $3,000 ea. including tax x 4 x 12 months 150,000
Officer’s Wages $5,000 ea. including tax x 2 x 12 months 120,000
Insurance plus Workmen’s Comp 50,000
Fuel (variable) 50,000
Rent 25,000
Other 25,000
Total Annual Administration and Other (420,000)
Total Cash Uses for Prototype Development and Validation – Year 1 (3,550,000)
Cash Sources Available for Beta Conversion and Exploration – Year 2 (See Page 3) $1,300,000

NOTE: Total cash required for Prototype Development and validation is $3,550,000. This amount needs to be placed in a bank account available for Corporate use. The balance $1,300,000 will be placed in an interest bearing account requiring two signatures subject to conditional use to continue exploration and gold production.

Sources of Funds – Beta Exploration and Alpha Conversion (Year 2)- Three Hi-Value Target Properties.
Cash Available after Proof of Prototype $1,300,000
Uses of Funds – Five Months with One Month Working Capital for Alpha Conversion:
Additional Equipment Requirements $(100,000)
Site Evaluation and Preparation:
Legal Contracts (Hydro-Mining Properties, LLC) $30,000
Pre-site Evaluation – Professional Fees 50,000
Site Historical Research 15,000
Travel 30,000
Total (125,000)
Site Preparation and Set-up:
Advance Crew with Preparation – to site 30,000
Drill Rig, Special Sampling Equip – Transportation 120,000
Total (150,000)
Beta Drilling:
Direct Costs –fuel, labor, maintenance x 5 months 500,000
Sample Analysis 60,000
Offsite Sample Analysis 60,000
Evaluation for Alpha Conversion 10,000
Other 40,000
Total (670,000)
Alpha Conversion:
One month Working Capital Requirement 100,000
Processing Equipment – Transportation 35,000
Community Involvement:
Security (one month) 5,000
Reclamation, replanting contracts 5,000
Food concessions 5,000
Community promotions, environmental concerns 5,000
Permitting, legal review 5,000
Other 40,000
Total (200,000)
Total Cash Uses for Beta Exploration and Alpha Conversion Year 2 (1,245,000)
Cash Sources Available for Contingencies $55,000

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