Investment Proposal Prepared for: Prepared by: Jack McConnell, Guitarist & Vocalist September 19, 2017 Proposal number: v1

MELBA CULP

Demo Link - https://youtu.be/OfR1C7veWRs

INVESTMENT SUMMARY

About

Melba Culp is a heavy metal band founded in late 2015 by guitarist and vocalist, Jack McConnell. The band is currently based out of Austin, TX. In early and mid 2016, Jack traveled to Nashville to record the demo clips featured over a two-day period. The drums and bass were performed by session players under his supervision.

Objective Melba Culp strives to become one of the biggest heavy metal acts on the planet. Melba Culp also strives to re-shape the industry from the artist’s side to become and influence self-sufficient artist entities independent from separate labels, merchandisers and publishers. This gives the artist and investor more financial incentives and the artist more creative control, opening up the opportunity for a middle-class and greater investment in music.

Solution & Investment In order to grow Melba Culp into a massive entity, a spectacular and carefully planned launch to the greatest degree of passion and integrity is needed. This launch will feature explosive live shows, an album release, merchandise inventory, the release of multiple music videos, various promotional and marketing campaigns, as well as the legal structure needed to grow into this giant. Melba Culp’s structure will be able to achieve an additional 20-30% net on revenues against industry averages. Melba Culp is offering 50% of net profits pre-recoupment and 15% of net profits post-recoupment in exchange for a $700,000 investment. These net profits include all related income from Melba Culp and it’s operations.

Project Outline The project will create audio and video content of the upmost artistic value and originality. The project will take place in three stages: • Content Creation, Merchandise Inventory, and Legal/Structure • Release and Promotion (Digital) • Live Promotion

MELBA CULP

BUDGET

The budget is broken down into several sections featured below:

Recording Costs & Audio Content, Video Content, Release, Promotional Material, Marketing, Merchandising, Live Equipment, Legal/Structure, Tour Support, and Additional Funds. Disclaimer: Budget is subject to change in regards to specific fund allocation, certain factors may increase or decrease the amount shown. For example, much of the live equipment comes from the same distributors and is subject to discounts of up to 50% while air travel can fluctuate throughout the year.

Recording Costs & Audio Content Quantity Unit Price Cost

Studio Day Rate 50 $ 400 $ 20,000

Hotel Stay 50 $ 45 $ 2,250

Air Travel 2 $ 200 $ 400

Ground Transportation (Airport Round-Trip) 4 $ 23 $ 92

Ground Transportation (Studio Round-Trip) 100 $ 8 $ 800

Session Drum Tracks 5 $ 150 $ 750

Session Bass Tracks 5 $ 85 $ 425

Mixing 10 $ 1,000 $ 10,000

Mastering 10 $ 600 $ 6,000

Total $ 40,717

Video Content Quantity Unit Price Cost

Music Videos 7 $ 35,000 $ 245,000

Lyric Videos 9 $ 2,500 $ 22,500

Total $ 267,500

Release Quantity Unit Price Cost

Digital Distribution 1 $ 55 $ 55

MELBA CULP

Ringtone Distribution 1 $ 20 $ 20

Music Video Distribution 5 $ 95 $ 475

UPC Code 1 $ 250 $ 250

Total $ 800

Release Quantity Unit Price Cost

Promotional Material Quantity Unit Price Cost

Still Photography Sessions 3 $ 500 $ 1,500

Website Design & Function (yearly) 3 $ 455 $ 1,365

Business Cards 1500 $ 0.14 $ 210

Total $ 3,075

Marketing Quantity Unit Price Cost

YouTube Video Advertising Budget 1 $ 35,000 $ 35,000

Facebook Targeted Advertising Budget 1 $ 25,000 $ 25,000

Instagram Advertising Budget 1 $ 500 $ 500

Twitter Advertising Budget 1 $ 500 $ 500

Audience Network Advertising Budget 1 $ 5,000 $ 5,000

Guerrilla Marketing Budget 1 $ 2,000 $ 2,000

Hiring of Music PR Firms 1 $ 45,000 $ 45,000

Hiring of Music Marketing Agencies 1 $ 5,000 $ 5,000

Radio Campaign Budget 1 $ 10,000 $ 10,000

Total $ 128,000

Merchandising Quantity Unit Price Cost

CD Orders 5000 $ 0.7986 $ 3,993

ADR Shirt Orders 250 $ 8 $ 2,000

ADR Alternate Design Women’s Cut Shirt Orders 100 $ 9 $ 900

SH Shirt Orders 250 $ 8 $ 2,000

Band Poster Orders 200 $ 0.65 $ 130

Bumper Sticker Orders 100 $ 2.25 $ 225

SH Design Costs 1 $ 1,000 $ 1,000

Merchandise Table Vinyl Banner 1 $ 82 $ 82

Total $ 10,330

Merchandising Quantity Unit Price Cost

Live Equipment Quantity Unit Price Cost

Fractal Audio Systems Axe-Fx II XL+ Preamp/FX Processor 3 $ 2,250 $ 6,750

Fractal Audio Systems MFC-101 Midi Foot Controller MkIII 3 $ 650 $ 1,950

Fractal Audio Systems MFC-Edit - Editor for the MFC-101 1 $ 30 $ 30

Fractal Audio Systems Cab Pack Bundle 1 1 $ 100 $ 100

Fractal Audio Systems Cab Pack - ML USA Bass 1 $ 30 $ 30

TC-Helicon VoiceLive Rack 1 $ 800 $ 800

Sennheiser ew 572 G3-B-US Instrument Wireless System 3 $ 1,070 $ 3,210

Sennheiser SR 2050 IEM Transmitter 2 $ 2,950 $ 5,900

Sennheiser EK 2000 IEM Receiver 4 $ 700 $ 2,800

Sennheiser e 965 Microphone 3 $ 700 $ 2,100

Hercules Stands EZ Clutch Mic Stand with Boom 3 $ 75 $ 225

Ultimate Ears UE 7 Pro 2 $ 850 $ 1,700

Ultimate Ears UE 11 Pro 2 $ 1,150 $ 2,300

Furman P-2400 IT 1 $ 2,640 $ 2,640

Furman PST-8 1 $ 112 $ 112

Bose F1 Model 812 Flexible Array Loudspeaker/Subwoofer 1 $ 4,800 $ 4,800

Yamaha TF1 16-Ch Mixer w/ Tio 1608-D Dante Stage Box 1 $ 3,900 $ 3,900

Custom V Signature Guitars 6 $ 5,000 $ 30,000

Custom Bass Drum Head 1 $ 135 $ 135

Stage Backdrop & Scrims 1 $ 590 $ 590

AKG D112 MkII Professional Bass Drum Microphone 1 $ 200 $ 200

Primacoustic KickStand 1 $ 75 $ 75

Cables Budget 1 $ 1,000 $ 1,000

Custom Wardrobe - Lead 1 $ 1,500 $ 1,500

Custom Wardrobe - Backing 3 $ 250 $ 750

Road Cases USA 18 Space ATA Amp Rack Case 1 $ 350 $ 350

Road Cases USA 44” Cable Trunk Standard Height 1 $ 290 $ 290

Van Budget 1 $ 22,500 $ 22,500

Chauvet DJ Geyser P4 Vertical Fog Machine LED & Remote 2 $ 300 $ 600

Tama/Zildjian Drum Set 1 $ 5,000 $ 5,000

Bass Guitars 2 $ 1,849 $ 3,698

Rhythm Guitars 2 $ 2,500 $ 5,000

Total $ 111,035

Live Equipment Quantity Unit Price Cost

Legal/Structure Quantity Unit Price Cost

US Origination Trademark 1 $ 900 $ 900

International Trademark (Madrid System) 1 $ 30,000 $ 30,000

US Copyrights (Music) 10 $ 35 $ 350

US Copyrights (Art) 3 $ 35 $ 105

LLC Formation 1 $ 1,000 $ 1,000

BMI Publisher Association Fee 1 $ 250 $ 250

ISRC Registration 1 $ 95 $ 95

Total $ 32,700

Legal/Structure Quantity Unit Price Cost

Tour Support Quantity Unit Price Cost

Tour Support 1 $ 50,000 $ 50,000

Total $ 50,000

Additional Funds Quantity Unit Price Cost

Additional Funds 1 $ 55,843 $ 55,843

Total $ 55,843

Grand Total $ 700,000

8%

23%

19%

50%

Stage 1: Content Creation, Merchandise Inventory, and Legal/StructureStage 2: Release and Promotion (Digital)Stage 3: Live PromotionAdditional Funds

Guitar/Vocals: Jack McConnell - Jack McConnell was born and raised in Austin, TX. With an early interest in music he began taking classical guitar lessons at age seven. After a year he transferred to a different guitar instructor where he continued guitar lessons with a rock oriented instructor for more than a decade. At age seventeen, Jack attended vocal lessons at the Austin School of Music for a year. Now twenty-one, he has since been working on developing his skills and songwriting. Apart from being a musician, Jack has worked various positions to save money for his music career, of which he has invested over $12k and intends to invest more including a significant portion of his net profits alongside the investor(s). Jack has worked as an

actor, feature film location manager ($400k+ budget), award-winning short film producer ($3,000+ budget), real estate agent at a firm specializing in residential investments, identifying investment opportunities for a private equity firm ($4M+ budget) and at the age of fifteen Jack managed Austrian band Crimson Lake (now Lionator) while in high school increasing revenues under his management until a split of the band. Additionally, Jack is the songwriter, co-producer, and director of Melba Culp’s business activities. With experience in film, Jack will also produce and direct video content.

Creative Team

Session Bass: Dan Hawkins - Dan is a session bass player and freelance musician based out of the UK. Dan has played live with Katie Melua and Martha Reeves and the Vandellas, and appeared on TV with Rod Stewart and Olly Murs, among others. His work can be found at www.onlinebassplayer.com. Dan played bass on the Melba Culp demo clips.

Session Drums & Studio Engineer: Chris Brush - Chris Brush is a session drummer and studio engineer based out of Nashville, TN. He is an in-house engineer and producer at PlethoraTone, where he worked as an engineer for the Melba Culp demo clips and recorded session drums for them as well. Prior to PlethoraTone, Chris worked mostly as a touring drummer until his recording work began to stack up, he began making a slow transition to a full-time studio player. Chris then went on to design the studio that is PlethoraTone with business partner, Mark Lange. You can find some of Chris’s work at www.chrisbrushdrums.com. Co-Producer: Mark Lange - Mark is the co-producer alongside Melba Culp’s Jack McConnell. Mark is co-owner of PlethoraTone, where the Melba Culp demos were recorded. The studio is based out of Brentwood, TN. Apart from running operations at PlethoraTone, Mark has been involved in music and recording sine the late '70s. He has an extensive knowledge and collection of audio equipment and instruments. Mark received his amateur radio operator’s license at the age of thirteen and has been an avid learner of electronics since. You can learn more abut mark and his studio at www.plethoratone.com.

Mixing: Adam Hawkins - Adam Hawkins is a grammy award winning recording and mix engineer set to mix the project. Adam has experience working with the following artists: Avenged Sevenfold, Mastodon, Switchfoot, Twenty One Pilots, 50 Cent, Pink, and many more. You can learn more about Adam at www.adamhawkins.com.

Mastering: Ted Jensen - Ted Jensen is a grammy award winning mastering engineer set to master the project. Ted has experience working with the Eagles, Green Day, Norah Jones, Evanescence, Alice in Chains, and many more. You can learn more about Ted at www.sterling-sounds.com/engineers/ted-jensen/.

Art: Travis Smith - Travis Smith is an American graphic artist well known for designing heavy metal album art. He has already designed the album artwork and will design artwork for “Sheepdog Heroes” as well as alter both designs to be printed on merchandise such as t-shirts. Travis Smith is well known for designing album art for Opeth, Avenged Sevenfold, King Diamond and many more. You can learn more about Travis’s work at www.seempieces.com.

Wardrobe: Jacqui King - King has designed for Mötley Crüe, Bon Jovi, Cinderella, Tesla, Poison, Dio, Whitesnake, Judas Priest, Playboy Magazine, and more.

Digital Audio Distribution Partner: TuneCore - TuneCore is a music distribution company based out of Brooklyn, NY and founded in 2005. TuneCore is one of the few distributors that does not take a percentage of sales revenue and solely charges a low annual fee of $50 to keep your items in stores. It automatically add your content to new stores at no additional cost, as it grows new partnerships. TuneCore distributes worldwide to over 150 digital stores and streaming services including iTunes, Spotify, Amazon Music, Google Play, YouTube, iHeartRadio, Napster, and many more. TuneCore also offers a partnership with Amazon for online physical orders that require no additional cost or inventory using Amazon on Demand. TuneCore is nearing $1B in artist earnings since it’s launch. You can learn more about TuneCore at www.tunecore.com.

Physical CD Manufacturer: CD Baby - CD Baby, Inc. is an online distributor and manufacturer of physical CD’s. CD Baby was founded in 1998 and is headquartered in Portland, OR. While CD Baby’s distribution and online stores (physically & digitally) do not make sense for Melba Culp, they are one of the most affordable and user friendly CD manufacturers. With a bulk order each CD will be under $1, including shipping allowing for maximum profit on the final sale. Notable artists at CD Baby include Dave Matthews, Macklemore & Ryan Lewis, Gretchen Peters, and many more. You can learn more about CD Baby at www.cdbaby.com.

Performing Rights Collection Organization: BMI - Broadcast Music, Inc. (BMI) is one of three United States performing rights organizations. BMI collects songwriting royalties on behalf of songwriters and then distributes them to the songwriter. Melba Culp will register with BMI as a publisher. Anytime an artist’s song is played, even if they are performing their own song at a public venue, the artist is entitled to royalties. These royalties are paid in various forms by sync licenses and live music venue dues. In 2015, BMI collected more than $1.013B in licensing fees

Additional Team

and distributed $877M in royalties. Notable artists associated with BMI are Nickelback, Linkin Park, Lady Gaga, Taylor Swift, Eminem, Shakira, Evanescence, Maroon 5, and many more. BMI collects monies for artists in relation to new media, television/network usage, radio play, satellite audio services, public use (ex: nightclubs, bars, restaurants, etc.), digital jukeboxes, live concerts, and more. BMI has offices across the United States. You can learn more about BMI and what kind of royalties they collect as well as how they collect them at www.bmi.com.

Lyric Videos: View Maniac - View maniac designs lyric videos for artists such as Adele, Major Lazer, Katy Perry, Demi Lovato, and many more; generating over 6 billion views for their artist’s lyric videos. Based out of New York and recently voted the #1 Music Promotion company in 2015-2016, View Maniac offers free promotional services of the lyric videos it creates.

Revenue Streams Mechanical Royalties - Sync Licenses - Sheet Music Sales - Lyric Display - Public Performance Royalties - Ringtones Revenue - Songwriter Awards Programs (BMI) - Publisher Settlements - Retail Sales - Digital Sales - Sales at Shows - Interactive Service Payments - Digital Performance Royalties - Master Use Sync Licenses - AARC Royalties - Neighboring Rights Royalties - Film Musicians Secondary Markets Fund - Sound Recording Special Payments Fund - Label Settlements - Shows/Performance Fees - Merchandise Sales - Trademark & Copyright Settlements - Fan Club/Patronage Support - YouTube Partner Program - Ad Revenue - Persona Licensing - Product Endorsements - Sponsorship - Signature Product Sales Royalties - Merchandise Settlements - Appearance Fees - Image Licensing - Book Sales - Television & Film Appearances - Residuals - Interview Fees - Instant Concert Recordings - Meet & Greet Experiences - VIP Soundcheck - Musical Clinics - Inventory Leasing - Fan Funding - Grants

Business Structure Melba Culp has created a unique business structure for maximum creative control, growth, retention, and financial incentives; serving as its own artist management firm, record label, publishing company, band, and merchandiser with eventual in-house legal council, a recording studio with office space and business management to follow.

Melba Culp has designated the following roles of which will initially be held by a small team ideally including the investor to expand to the following full-time positions:

President & Creative Director - Jack McConnell Director of Label Operations & Artist Management Director of Publishing OperationsDirector of Legal Operations & Business AffairsDirector of Communications & Public RelationsDirector of Finance Director of Marketing & Distribution Booking Agent & Tour Manager Merchandise Manager Studio & Headquarters Manager Production ManagerStudio Engineer & Live FOH Engineer Rhythm GuitarBass Guitar Drums

These positions are to be paid salary and a small portion of profit share from the activities in which they are directly involved. Apart from these positions Melba Culp strives to maintain a consistent part-time staff including a producer, road crew, film crew, etc. Melba Culp will

eventually form it’s own direct relationships with digital marketplaces and streaming services such as Apple and Spotify and bypass the middleman to ensure stability, control and maximum profitability. Melba Culp will, from the start, bypass middlemen such as the VEVO to YouTube partnership, with direct distribution to a monetized YouTube channel with maximum content freedoms and payout percentage.

Carrying out these operations from the start and filling the positions at a later time when revenue requirements are met will allow Melba Culp to be a massive self-sufficient entity working around the clock to bring music to the people. It is in our core beliefs that this is the future of the music industry. Melba Culp does have possible intentions of partnering with distributors, concert promoters, and other such tasks involving massive logistical planning and capital until at some point, Melba Culp has enough capital and manpower to finance it’s own tours and enough connections to run its own distribution network. As record sales continue to fall, digital sales and streams grow, as touring becomes the largest source of income and labels begin offering less and demanding 360 deals; it is our fullest belief this is the best way to not just survive but thrive in the modern music industry. Modern day artists must also be skilled and driven entrepreneurs.

How This Investment Differs From A Label’s

Financial Amount & Allocation: A major record label spends $750,000 to $1.4M to break a new artist. This investment is at the lower end of that amount and we believe it will accomplish far more than a label’s initial investment. Labels tend to need to fork out further investments for artists later on. A second release for a mid-level artist can be around a $4M expense. With the way Melba Culp is structured, the second release will be entirely funded by re-investing profits and crowdsourcing if needed through the fanbase established with the initial release. Future releases will likely not exceed the budget of this initial release and will not require the legal and live equipment capital required by this release.

Labels tend to spend around $200,000 of the budget on an advance for the artist they are going to break. This is an advance payment for the artist to live off during the recording and release process. The amount must be recouped by the label before the artist will start receiving royalties. The artist does not owe anything back to the label if the release fails. Melba Culp will not require an advance payment nor pocket a penny of the investment amount.

Recording costs tend to run $200,000 to $300,000 in major markets. Melba Culp has paved a way to greatly reduce the recording costs while maintaining a great degree of quality. The lack of songwriter and producer fees/advances helps us achieve this accomplishment. Video productions usually ranges between $50,000 to $300,000 to produce two or three music videos. Melba Culp is within this range, however, with Jack McConnell’s award-winning film experience and connections, we believe we can accomplish much more with a reduced budget. Videos are an area where we aim to give something very special to the markets and fans. Video content will be our greatest investment and the material to be promoted in our marketing and PR campaigns.

Tour support can generally run a record company upward of $100k. We have cut this budget in half with a live equipment budget to allow us to keep these costs continually low over a long period of time. Our live equipment budget is the most effective budget to be able to minimize crew staffing, allow for a quick and easy set-up and tear-down to most efficiently move from town to town, utilize technology to create the greatest sound and production for the least amount of cost, and to be able to replace and backing band members quickly if one is lost in the middle of an important tour or promotion.

Marketing and promotion generally cost between $200,000 and $500,000 for a record company. Of this amount, nearly 60% is spent on hiring PR firms, bloggers, etc. 20% is spent on ads featured on outlets such as YouTube, Facebook, etc. And the remaining 20% goes to various other marketing sources such as TV appearances. We have cut these costs

tremendously, partially thanks to our genre which traditionally requires less marketing funds than other genres to achieve similar levels of success. We have designed the most efficient and effective marketing budget at a fraction of the typical cost. Term: Record labels generally have a term with the artist, though they own the material recorded during that term forever unless agreed upon otherwise. A typical label contract is around three to four albums. At the end of the term, the artist can renegotiate his/her deal, though most choose to go to a different label or function independently going forward. Though labels continue to receive revenue indefinitely for the albums produced during the term, these revenues fall with time and they receive no payments from future workings of that artist. Publishing firms for songwriters face similar deal structure. The biggest bulk of artist income in the modern industry is touring and related activities such as merchandise sales at shows. In modern contracts, labels get a cut of these. However, once the term is complete the label misses out on the future bulk of earnings. An investor will have all avenues of revenue for life without the complicated overhead and politics of running an entire label with inconsistent staffing, leadership and direction. Venture capital funds have spotted many of these signals pointing away from traditional music financing and now groups such as Artist Alignment Capital, partnered with BlackRock, exist to seize the opportunity. However, with an investment range of $5M to $20M, there are very few people taking advantage of the early market artists with greater potential to reshape the industry, carrying greater long-term incentives.

Melba Culp aims to redefine the term “independent artist”, stretching it to its fullest extent.

Jack McConnell

layitround@yahoo.com +1 (512) 784-0738 8912 Pepper Rock Drive Austin, TX 78717-4834