Here is the summary I received from Ron Green. It came in WordPad format, so hope I got it all. I deleted a lot of formatting:
Avalon Group, Inc.
Summary of Informational Meeting
March 30, 1999
Cedar Rapids, IA
7:00 p.m. CST
Ronald Green, President of Avalon, welcomed those in attendance and made introductions of key personnel who were in attendance at the meeting.
Wallace Green- Director and Founder
William Green – Vice President of Operations
Bernard Hicks- Executive Vice President and Director
Chris Kavars – Vice President of Product Development
John Rhomberg – Project Controller
Von Elbert – CFO
Hugo Pomrehn – Chairman, Appropriate Health Services.com
Michael Donahue – Attorney
James Brems – CPA
Following introductions, Ron announced that a special shareholder meeting will be held on Monday, April 12, 10:00 a.m., at Moyer and Bergman, PLC in Cedar Rapids and that all shareholders were sent a packet of information containing the Proxy Statement and Offering Memorandum and a form of Proxy. Ron took a straw poll of those in attendance to find out if they had received this informational packet. All had received this packet. Ron also disclosed that within two to four days following the April 12th meeting, closure of the merger with Appropriate Health Services.com would take place in California.
Ron summarized the terms of the Merger Agreement; emphasizing to the shareholders that 90% shareholder approval is required, if it is lower Appropriate Health Services.com (AHS) will determine what is acceptable. Michael Donahue, P.C. reported on the Fairness Hearing Meeting that was held in Los Angeles, California, Thursday, March 11, 1999. Ron Green and John Collins testified at the hearing. An independent appraiser also testified that Avalon stock had a value between $.17 to .24 cents a share and that the $.25 offered by AHS was fair. Shortly after this hearing the Commissioner issued a permit.
POWER POINT PRESENTATION: Presented to Share Holders
StayHealthy.com - Company Overview
Founded in 1995, one of the first companies to build a “health portal”
Internet sales relationships with pharmaceutical, nutraceutical and other product providers
First to commercialize biomedical devices using the Internet, leveraging core technologies, product patents
Developing strategic relationships with affinity groups to commercialize internet bio-device programs
StayHealthy.com's Health Portal
Meets Jupiter Communications' # of visitor criteria to qualify as one of the top 10 Health sites - ranked #3 by traffic
“Top health sites” list in PC Novice Web Guide
Developing brand and driving internet traffic with content rich site:
Comprehensive drug database with images
Health Resource Directory of 4,000 web sites
Successful pilot of Health Net Sampler - Warner Lambert products
BioSense Program
BioSense Hardware & Software:
Calorie Burn Tracker
Body Composition Analyzer
Product Development Plan - 1999
R&D is complete and technologies acquired/licensed
Internet Services/Web Site
Enhancements: add interactivity / e-commerce Q1
BioSense Hardware & Software
Launch Calorie Tracker Q3
Launch Body Comp Analyzer Q3
e-commerce Products
Breathehealthy products Q1
Health & Wellness - over 7,000 products Q2-Q3
BioSense Program Q3
Management Team
Hugo Pomrehn Chairman
John Collins CEO
Ron Green President
Bernard Hicks Exec. VP
John Demoleas Director of Corp Dev
TBA CFO
Brian Peterson FDA Compliance
Bill Green Web Director
Chris Kavars Technology/Engineering
Management Team - Advisory
Dr. Colin Hill MD, PhD, Cancer Research
Paul Pomrehn MD, Public Health
Dr. Al Pizzo MD, Nutraceuticals
Dr. Al Nutt MD, PhD, Biosensors
Dr. Johnny Sawada PharmD, Pharmaceuticals
Dr. John Wollner MD, Dermatology
Gerry McLaughlin Technology Consultant
Focus Groups Patient/Consumer
Affinity Groups
AFAA
160,000 certified personal trainers, 60,000 active, 70% market share
Each trainer typically has 100 clients
Potential 6,000,000 buyers influenced by AFAA
Program Goal
To improve client retention by giving trainers and clients the ability to effectively monitor the progress of personal training programs
Same dynamics apply to sports/fitness clubs
Affinity Groups
Hospitals, Medical Clinics & Insurance Companies, examples:
Prairie Heart Institute, Illinois
Columbia HCA
Blue Cross Blue Shield
Program Goal
To increase awareness of services, to provide basic health & wellness information, to help individuals in selecting physicians, increase revenues
Enabling true Web interactivity StayHealthy.com
Questions and Answers:
Who is building your search engine and who is doing the program?
Avalon utilizes existing staff and vendors. Avalon is currently working with Procend, Cedar Rapids, IA, PageTek, Hudson, IA, and Interactive Ideas, Huntingbeach, CA.
Any forward looking documents (financials) for the merged company? And do you have any financial statements from Avalon?
With major funding in place from institutional investors, we are projecting $24 million in revenue after the first year and growing to $50 million in year two.
Yes, we have copies of the 1998 Audit here tonight that we can provide to you.
What is the likelihood of funding?
Good, John Collins (Appropriate Health Services.com) has a signed financial service agreement with Sutro. They are a one hundred-year-old investment company in California. The goal is to raise 5 to 7 million dollars in the next 90 days.
Is it enough?
No, we will continue to raise capital to sustain the operation. AHS and Sutro are already preparing for an IPO, which will enable more capital to come into the Company.
With this merger and the institutional investors coming in, will this dilute the existing shareholders' interest?
No, AHS's current 504 offering is at $2.00 per share. We would anticipate that the next round of funding would be higher in the $4 to 5 dollar range.
Why is this merger taking place?
After several month of working with AHS, both parties found that a real synergy existed between Avalon and AHS. What AHS brings to the table is what Avalon lacks: fund raising capability, marketing and sales expertise, and management with experience running a public company.
What is your perception of the market share? How do you capture a big market share?
No health related website has broken through like other major web sites in other markets. By creating a stickier web site at stayhealthy.com, through the introduction of our BioSense program we feel this will afford us the opportunity to get large market share in the health and wellness market.
Can another web site take our devices and do the same thing?
We have filed a patent application for the BioSense Program, this may either lock people out or slow them down. The patent application is all encompassing.
Are these Avalon products? What advantages are they bringing to the merger?
Both companies are bringing technologies to the BioSense Program. We feel each company is sharing equally with what they are bringing to the table.
Back to the Question of “Who is your market” especially if you are going out for the IPO?
We are creating a “health portal” for all people. “Anyone who is interested in their health and wellness and has access to the Internet.”
Who will you be advertising with?
There are different ways to approach this. Currently, we are exploring several cost-effective advertising programs. As time goes by we anticipate that we will be spending a large amount of dollars in marketing and sales. |
