Royal Spring Water (fka RSPG)

[NebraskaRules]

The majority of the infrastructure necessary for the operation of the plant was already in place upon commencement of the lease. The further capital necessary to complete the development of the plant and acquisition of bottling equipment, leading up to operations to commence in June 2006, was funded through the shareholder advances described above.

If during that period or thereafter, we are not successful in generating sufficient liquidity from operations or in raising sufficient capital resources on terms acceptable to us, this could have a material adverse effect on our business, results of operations, liquidity and financial condition.

Our independent certified public accountants have stated in their report included herein that we have incurred operating losses since our inception, and that we are dependent upon management's ability to develop profitable operations. These factors among others raise substantial doubt about our ability to continue as a going concern.