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The annual meeting of stockholders of SolarAttic, Inc was held at the Riverwood Conference Center, 10990 95th Street NE, Monticello, MN 55362 at 7:00 PM on February 15, 1996 in the "NATURE'S EDGE" conference room. This was a last minute change by the conference center from our scheduled location of the "GAZEBO" room. Nature's Edge was located about twenty feet down the hallway. From 6:30 p.m. to 7:30 p.m. was a social time and an extra allowance for stockholders to arrive. The meeting was called to order at 7:30 p.m. by Ed Palmer, President, who chaired the meeting, and Ed Palmer (also Secretary) kept the record of the meeting.
Ed Palmer for EJ Partners, Ltd.
Cliff Lundberg
Larry Matthews
Larry Garde
Beverly J. White
Jim Stanley for The Stanley Group
Jim Stanley
Jim Kantorowicz
Twenty Two shareholders representing 15.6% of the shares outstanding were not represented at the stockholder's meeting. The shares represented in person were 53.4% of the total shares outstanding. The shares represented by proxy were 30.9% of the total shares outstanding. A total of 84.3% of the outstanding shares were represented at the stockholder's meeting.
SolarAttic, Inc. Annual Stockholders Meeting 1996
The following stockholders were represented by proxy:
Lee M. Berlin
Eugene & Marcelyn Benjamin
James R. Cargill II Trust
Nauman Trust
Bill Fredell
Jean M. Crimmins
Lorraine N. Edberg
Brian Mechler
Barbara Lepse
Mark Stipakov
Clement C. Johnson
Jacqueline L. Palmer Trust
Dorothy Stoeckel & Kris Anderson
Roland & Pearl Starry
Jeff Kelsey
Terry Kelsey
Patty Palmer
Svetlana Shubinsky
Mario Gramigni
Dmitry Mogilyansky
Matvey Gezunterman
Jean & Dick Wiese
Joel R. Wiberg
David C. Smith
Ray Schuster
Joe Sullivan
Solid Rock Church
The Chairman announced that the people present in person and by proxy constituted a quorum (33% minimum of the total shares outstanding required) in accordance with the Corporation's Article's & By-Law's and were authorized to vote all of their shares.
The Chairman announced that the purpose of the meeting was to: a) Elect three directors to serve for the following year and, b) to present a management presentation on the events that occurred during 1995.
The following corporate records and documents were made available for review:
Corporate Articles; By-Laws; Stock Ledger; 1995 Financial Records; Financial
Summary Records from Prior Years; Stockholder Minutes & Records from
2/19/91; and, Director's Minutes & Records. Copies of the company's new
pool heater brochure, updated space heating brochures and minutes of last
year's meeting were available for stockholders to take with them if
desired.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
The following literature products were made available for review: Guide to Swimming Pool Heating; Pool Heater Manual; Space Heater Manual; How To Calculate Pool Heating Costs (Marketing Report); How To Create An Energy Efficient Pool (Marketing Report); and, How To Understand Pool Heat Pumps (Marketing Report). A portfolio of other literature that is used in the company's Business and Consumer Kits was also available.
In addition, and for reference purposes, Minnesota Statute 302A, the Minnesota Business Corporation Act was available along with Robert's Rules Of Order.
Approval Of Agenda
The meeting agenda was presented and the Chairman stated that no additional
business had been brought up before the meeting. There being none, the Chairman
asked if there was a motion to accept the agenda as it stands without any
modification. Jim Stanley made the motion: "There being no requests for additions
to the agenda prior to this annual meeting, the agenda shall hereby be approved
as presented without any changes." Larry Matthews seconded the motion. There
was no discussion and the motion was unanimously approved.
Approval Of Minutes
The waiver of reading of last year's minutes was the next order of business.
The Chairman noted that last year's minutes had been mailed to all stockholders
shortly after last year's meeting and then offered to entertain a motion
to accept last year's minutes as written without reading them aloud. Larry
Garde made the motion: "That the minutes of the last stockholder's meeting
which was the Annual Stockholder's Meeting held on 2/15/95 be approved as
written and without being read aloud." Jim Kantorowicz seconded the
motion. There was no discussion and the motion was unanimously approved.
Approval Of Company Business
There was no old business. The chairman started the new business with
a request to entertain a motion to approve last year's activities of the
company. Larry Matthews then made the motion: "That all purchases, contracts,
contributions, compensations, acts, decisions, proceedings, elections, and
appointments by the Officers or Board of Directors during 1995, and all matters
referred to in the Stockholder letters for the Fiscal Year ending 12/31/95
be and the same hereby are approved and ratified." Beverly White seconded
the motion. There was no further discussion and the motion was unanimously
approved by the stockholders.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
Opening Of Nominations
At this point, the chairman noted that management recommended that Larry
Matthews, Larry Garde and Ed Palmer be reelected as directors for the coming
year and offered to entertain a motion to open up nominations for the board
of directors. Motion was made by Cliff Lundberg "to open up nominations
for the board o fdirectors for the election of three directors to serve for
the year of 1996-1997." The motion was seconded by Jim Stanley. There was
no discussion and the motion was unanimously passed. The Chairman announced
that nominations were open.
Nominations
Upon motion made by Jim Kantorowicz and seconded by Beverly White, Larry
Matthews was nominated to serve another term.
Upon motion made by Cliff Lundberg and seconded by Jim Stanley, Larry Garde was nominated to serve another term.
Upon motion made by Cliff Lundberg and seconded by Jim Stanley, Ed Palmer was nominated to serve another term.
Close Of Nominations
There being no other nominations, the Chairman asked for a motion to
close the nominations. "Motion to close nominations for the board of directors"
was made by Cliff Lundberg and seconded by Jim Kantorowicz. There was no
discussion and the motion was unanimously approved.
Adoption Of Candidate Slate
The chairman then offered to entertain a motion to "adopt the slate
of board of director candidates as presented." Cliff Lundberg made the motion
and Jim Kantorowicz seconded it. There was no discussion and the motion was
unanimously approved. Larry Matthews, Larry Garde and Ed Palmer were reelected
to serve as directors. The Chairman declared that the above named persons
were duly elected directors to hold office for the ensuing year of 1996-1997.
Management Presentation Starts
There being no further new business, the chairman proceeded into the
company's management presentation which began at approximately 7:40 p.m.
and lasted until approximately 9:05 p.m. Ed Palmer, the company's chairman
and also the company's president and CEO made the management presentation.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
Overview Of Technology & Patents
The chairman opened up the presentation with an overview of the technology
tha thas been developed by SolarAttic. This consisted of several drawings
from the company's patents. Drawing figure 1 from U. S. Patent 5,014,770
was shown first to point out the pool heating application using attic heat.
The chairman noted that this is the primary product currently being sold
by word of mouth. A pool plumbing diagram was presented next to show
how the system is installed. Figures 5 and 6 from the same patent were then
shown to indicate that this "technology" patent also covers the heating of
domestic hot water from attic heat and also space heating using the hot water
in conjunction with a hydronic heater [in house wall radiator]. The chairman
noted that this patent also showed how this new technology could work in
conjunction with heat pump technology to reduce the chemical and electrical
requirements of heat pumps.
Drawing figure 1 of U. S. Patent Re. 32,607 was then presented to show the company's current space heating application and product. The chairman noted that this second patent was acquired from Ohio inventor David C. Smith.
Drawing figure 1 of the company's third U. S. Patent 5,452,710 (issued on September 26, 1995) was then presented to show how the company's technology can be used to provide free domestic hot water. The chairman noted that while this didn't seem to be a big deal in Minnesota, it will work 5-7 months of the year in the state. However, in states like Florida, the technology will find mass applications. The chairman cited Florida Power & Light's (FPL) electrical service area as an example where substantial reductions in electrical consumption could take place. FPL has an estimated 2.5 million customers with electric hot water tanks. Combined, they consume the output of three power plants daily. A whopping 470 megawatts of power. If deployed on a system wide basis, the company's technology could eliminate 80-90% of this power consumption and possibly more. Drawing figures 1-6 of patent application 08/528,720 were shown next. These drawings show the substance of the company's fourth patent application which covers SolarAttic's new duct and ventilation technology. U of M Professor Ephraim M. Sparrow is listed as a coinventor with the company's president Ed Palmer on this 4th patent application.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
Company Now Expects 4th Patent
The chairman noted that the company has already heard back from the patent
office. While the original claims had been hammered (disallowed) by
the Patent Office and nine patents were cited -- there didn't appea rto be
any significant reason why the company would not obtain this fourth U. S.
Patent. In other words, the company feels that it can address the Patent
Office's objections and obtain the patent.
Larry Garde, one of the company's directors, is helping prosecute the patent. He provided his own assessment o fthe patent. Larry agrees with the chairman that, unless something new from the patent office surfaces, we are headed for a fourth patent. The chairman estimated that the new patent would be issued later this year.
4th Patent High Priority
The chairman stated that prosecuting the 4th patent would take up some
substantial time and would be a high priority. The fourth patent provides
a substantial gain technologically and in overall market size. The company
will need to file for international protection on the fourth patent by October.
This will give the company an edge overseas even with the products
from the three heat transfer patents. The new duct technology can be "added"
on to the company's heat transfer products making them more efficient. It
gives the company another proprietary marketing edge. Anyone who wants to
buy the product will have to buy it from SolarAttic!
The chairman then summarized the technology & patents.
DOWNLOAD PDF FILE FOR TABLE 1
TABLE 1
Patent Expires Description
5,014,770 May 14, 2008 A new solar technology patent that shows
how to heat hot water, swimming pools and space through the heating of liquids
by attic based solar heat energy. Patent also shows technology useful in
heat pumps. And it also discloses a custom electronic control system.
Re. 32,607 March 5, 2002 A device specific patent that shows a system
for supplementing space heating by relocating warm attic air to the inside
of the house or building structure.
5,452,710 May 14, 2008 A new solar technology patent that shows how to heat
hot water free without the use of the utility company power grid.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
Application No. Est. Oct. 2013 A new duct technology patent application 08/528,720 that shows how to create an inexpensive duct system to collect all heat within an attic or other cavity for augmenting heat transfer. Also useful for ventilation of attic and the elimination of all roof holes. Expected to be issued in October 1996 after further response to patent office objections. It is now the company's judgment that it will successfully prosecute the patent application. Technology also has applications within the medical and other industries.
After reviewing the technology that has been developed, the chairman summarized the market implications for the technology as follows.
Market Size Estimates
DOWNLOAD PDF FILE FOR TABLE 2
TABLE 2
Market Identified Market Size Estimate Patents
Swimming Pool Heating $195 Million 5,014,770, 08/528,720 Pending
Electric Hot Water Heating $393 Million 5,014,770, 5,452,710, 08/528,720
Pending
Space Heating New Category Re. 32,607, 5,014,770, 08/528,720 Pending
Ventilation & Blowers $2.85 Billion 08/528,720 Pending
The next slide reviewed was: "What's It All Mean?" It means that SolarAttic can grow to over $100 Million in size over 10 years. This would be a small fish in a large pond from a revenue and market size perspective. It means that the technology itself will command larger capital investments. And, it means the next SolarAttic IPO run will meet with SUCCESS! [Chairman's opinions and estimates]
IPO Reviewed
The chairman then began a review of the failed IPO process. What went
wrong? What worked? Etc. The first slide was a graph of the funds being
escrowed during the last eight weeks of the IPO. Clearly the IPO was taking
off.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
A review of the IPO investor database revealed 1541 investors on file. It showed the sources of the investors and where the IPO funds had been derived from. I.E. Which advertising vehicle worked?
The top five sources of IPO investor funds were: Star Tribune (56.9%); Pioneer Press (11.7%); MEC Newsletter (6.2%); State Fair booth (5.8%); and, Referral (5.7%). These top five accounted for 86.3% of the funds received during the offering. The other 13.7% of funds were received from 13 other sources. The comparison clearly shows which ads (efforts, etc.) pulled for the company's IPO and which didn't. It also gives a clear indication of which were cost effective and which were not. The following table of direct IPO expenses was then presented:
IPO Expense Analysis
TABLE 3
| Expense Item | Amount | Percent |
| Accounting | 14,350.00 | 30.55% |
| Advertising | 12,607.61 | 26.84 |
| Legal | 8,832.50 | 18.80 |
| Printing | 4,487.93 | 9.55 |
| Postage | 3,388.88 | 7.21 |
| Government Fees | 1,167.25 | 2.48 |
| Public Relations | 1,075.00 | 2.29 |
| Office Supplies | 800.04 | 1.70 |
| Misc. | 267.50 | 0.57 |
| Escrow Fees | 0.00 | 0.00 |
| Totals | $46,976.71 | 100.00% |
|---|
The company's lawyer has told us that what we accomplished from a legal perspective was worth $200,000. So, overall, our strategies did accomplish a lot with a small amount of financial resources. The exposure the company received was probably worth the entire amount of our expenditures--despite our IPO failure.
The chairman then reviewed a slide titled: "IPO -What Worked For Us? " The following list was provided and discussed:
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SolarAttic, Inc. Annual Stockholders Meeting 1996
The chairman then reviewed a slide titled: "IPO -What Didn't Work? " The following list was provided and discussed:
Two slides covering major obstacles encountered were presented and discussed:
The next slide highlighted the decision to pull the plug on the IPO. It was based upon three main factors: A) State Law Violations by Minnesota's Security Registration Division; B) Statutory Period Ending requiring that we "rollover" the prospectus; and, C) No Financial Resources. With the State taking illegal actions beyond the scope of our laws, it was impossible to predict a successful outcome. The company also lacked the wherewithal to engage the state in a legal dispute. With a cooperating Registration Division and a few more resources, the company could have continued on and would have succeeded in its IPO.
The chairman discussed the state's actions in depth pointing out that the company has now petitioned Governor Carlson to institute an investigation of the Securities Registration Division for violating state laws. In essence, the state did not follow state laws. Instead, state bureaucrats forced internal departmental policies upon SolarAttic in direct violation of state law. Their actions imposed an estimated additional $20-25K in unnecessary expenses upon SolarAttic in order to continue. Their actions also caused the company to lose an estimated 40% of its valuable marketing time. This was something the company could not deal with either from a financial standpoint or time standpoint. Built into the IPO assumptions was a cooperative state agency. We did not expect that the Securities Registration Division would prove to be the number one obstacle to our IPO. State laws are in our favor.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
The next slide presented a list of four major gains the company experience.
"What We Gained!" was presented and discussed in detail as:
The chairman noted that SolarAttic is known in Minnesota and it will be markedly easier next time from a public awareness standpoint. He also noted once again: "It is not where we are at that counts, it is the direction we are heading. SolarAttic is heading in the right direction. "[WISDOM]
Word of Mouth PCS1 Sales
The chairman then proceeded on with the presentation to talk about word
of mouth sales. Word of mouth sales on the PCS1 pool heater increased to
28 sales during 1995. Product was shipped into three additional states: Alabama,
Louisiana and Mississippi. It's now in 27 states. The following graph shows
pool heater sales.
The chairman noted that sales dropped in 1994 as the company prepared for and entered in to the IPO process. Cliff Lundberg asked if there had been any major problems that had surfaced with the product [PCS1]. The chairman responded that there hadn't been any significant product problems.
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SolarAttic, Inc. Annual Stockholders Meeting 1996
There have been a few incidents of minor vibration that were solved by replacing the fan blade on the unit. In its current shipping configuration, the fan blade and motor may be a little vulnerable to movement or shifting during transit. And, there was some room from a product standpoint for further improvement.
The next slide reviewed the individual PCS1 product shipments. The chairman noted that Jim Kantorowicz took over the building process in May of 1995 and was now well trained on the assembly and production of the PCS1. The chairman also pointed out the freight ranged from $76.80 to 150.32 with an average of $104.78. Since the company ships this product FOB Elk River, the freight is due on delivery. Most orders were paid for by credit cards.
James Dulley Article
The chairman noted that 427 product inquiries were processed during
1995. Of these, 326 or 76.4% were the direct result of an article published
on April 23, 1995 by syndicated energy columnist James Dulley. The other
23.6% were scattered over 18 other sources including a couple of books that
now contain information about the company's products. Second behind the Dulley
inquiries were referrals. Larry Garde mentioned that this was significant.
The chairman noted that we now have a couple of excited New Yorkers that
are spreading the word about our product. It is a
father-son team. The father owns our PCS1 pool heater and claims to have
swam in his pool into October of last year. He states he quit because too
many leaves were getting in his pool. His son owns a radiator repair business.
And, the two are exploring selling our products in New York.
Big Sales Achievement
The Dulley article was of particular interest from a sales perspective. Twenty three systems were sold to this base of inquiries. That constitutes a 7.05% direct mail response rate with a product that is $1800 in cost. Follow-up calls were made and James Dulley did us a favor by publishing our price in his materials that he sent out. This sales effort constituted a big sales achievement for the company. We literally processed half the inquiries that we did from two prior media mentions. And, we doubled the response rates, doubled the system sales and enhanced our sales process.
A slide showing the Los Angeles Times version of the James Dulley article was then presented along with two slides showing some of the material that Dulley sent out to those people who inquired about our product. [See the copy of the Los Angeles Times article attached to these minutes.]
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The 1995 sales experience with Dulley's inquiries help to point us in the direction we need to go for expanded sales of the PCS1. The company plans on trying a few new low cost sales initiative during 1996. The chairman then reviewed the marketing test of the company's combination space heating ventilation product.
Big Marketing Test
During the 1995 Minnesota State Fair, the company conducted a major marketing test with the people who visited the booth. In the two previous years, the company presented its space heating product only to draw blank stares from consumers who could not grasp the space heating concept and the fact that there was heat available in the attic during the spring and fall. With the new duct technology developed, the company created a prototype of a new product that allows consumers to use it 12 months of the year. The prototype product consisted of elements of the company's space heater combined with the company's new duct technology. With the simple turn of an air switch, consumers could see air being vented out of an attic model or being returned to the inside of the house via a ceiling diffuser [with red streamers].
This was a no brainer for consumers and we experience few blank stares. By and large consumers easily grasped and liked the new product concept. Everyone knows it is advantageous to vent the heat out of the attic in the summer and the moisture in the winter. No argument on these points. After consumers grasped the ventilation concept, they readily accepted the idea that heat could be available in the spring and fall. The prototype's introduction was so successful that people wanted to buy this product right out of our booth.
We will attempt to create a salable version of this product for this year's state fair display with the intent of selling the product at the booth. This is a difficult objective given the limited resources available. Still, it is our goal for the fair.
Two Big Technology Gains
The chairman then moved on to the next slide which pointed out that the company had two big gains on the technology side during 1995. The third U.S. Patent was issued and the fourth patent was applied for!
Financial Review
The chairman then conducted a review of the company's financial information. Items reviewed included the following: 1995 Operations Summary; Source of Cash Resources; Balance Sheet 12/31/95; Equity Growth; and, commentary.
The chairman pointed out that the financial data as presented was NOT GAAP ADJUSTED. GAAP stands for generally accepted accounting principles. If the company was under SEC reporting requirements, company data would be GAAP adjusted by the company's auditors. Instead, the data presented is as it comes off the company's accounting system and is unaudited data. The chairman pointed out that an effort would be made to present the materials in a GAAP adjusted way for raising additional capital. Updating the financial information for prospective investors was the chairman's next project. The chairman pointed out that there is a list of several private investors who are waiting for updated company information. The following financial information was presented or discussed. Cash resources were derived from internal sales profits and the sale of common stock [equity in the company].
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SolarAttic, Inc. Annual Stockholders Meeting 1996
Cash Resources
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Equity Doubled
![[Image]](imgs/AMtg2_pict7.gif)
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SolarAttic, Inc. Annual Stockholders Meeting 1996
| Revenue | 49,934.12 |
||
|
|||
| Cost of Goods Sold | |||
|---|---|---|---|
| Opening Inventory | 31,033.38 | ||
| Purchases | 26,510.56 | ||
| Freight Inbound | 1,635.10 | ||
| Cost of Goods Available for Sale | 59,179.04 | ||
| Less | Current Inventory | 34,300.50 | |
| Cost of Goods Sold | 24,878.54 | ||
| Gross Profit | 25,055.58 | ||
| Expenses | |
|---|---|
| Salaries & Wages | 19,442.00 |
| Advertising | 10,929.05 |
| Interest | 6,935.41 |
| Amortization | 6,442.11 |
| R & D | 5,265.80 |
| Postage | 3,370.45 |
| Office Supplies | 3,203.49 |
| Rent | 2,460.00 |
| Auto | 2,434.62 |
| Mfr Supplies | 2,371.86 |
| Medical | 2,236.40 |
| Utilities | 2,035.70 |
| Legal | 2,010.76 |
| Payroll Taxes | 1,853.11 |
| Depreciation | 1,804.47 |
| VISA/MC/AMEX | 1,581.39 |
| Telephone | 1,563.28 |
| Marketing | 1,524.20 |
| SEC Requirements | 1,060.00 |
| Software | 971.45 |
| Computer Supplies | 815.44 |
| Long Distance Calls | 738.65 |
| Printing | 662.40 |
| Book Expense | 639.97 |
| Training | 453.43 |
| Online Services | 399.06 |
| T & E (50%) | 331.50 |
| Insurance | 282.66 |
| Repairs | 258.38 |
| Maintenance | 200.22 |
| Subscriptions | 171.89 |
| Bank Charge | 73.68 |
| G & A | 66.24 |
| Dues | 50.00 |
| Expendable Tools | 15.96 |
| Misc IPO Expense | 5.00 |
Total Expenses |
84,660.03 |
| Net Income | (59,604.45) |
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SolarAttic, Inc. Annual Stockholders Meeting 1996
Balance Sheet
12/31/95
| Assets | |
|---|---|
| Current Assets | |
| Cash 1 | 22,758.05 |
| Current Inventory | 34,300.50 |
| Officer Loan A | 6,305.35 |
| Officer Loan B | 33,501.65 |
| Total Current Assets | 96,865.55 |
| Fixed Assets | |
| Accumulated Amortization | (21,205.28) |
| Accumulated Depreciation | (20,720.44) |
| Computer Hardware | 20,217.43 |
| New Machinery & Equipment | 4,013.29 |
| Office Equipment & Fixtures | 3,972.28 |
| Signs & Displays | 4,301.46 |
| U.S. Patent 4,502,467 | 61,200.00 |
| Used Machinery & Equipment | 300.00 |
| Total Fixed Assets | 52,078.74 |
|---|---|
| Total Assets | 148,944.29 |
| Liabilities | ||
|---|---|---|
| Current Liabilities | ||
| Community Credit Loan | 27,021.37 | |
| Family - Compuserve VISA | 2,366.75 | |
| Use Tax Payable-MN | 582.01 | |
| Accrued Interest | 345.59 | |
| Accrued FED Income W/H & FICA | 84.17 | |
| Accrued MN Income W/H & SUTA | 31.62 | |
| Accounts Payable | (17.04) | |
| Total Current Liabilities | 30,414.47 |
|
| Long-Term Liabilities | 0.00 | |
| Total Liabilities | 30,414.47 |
|
| Owners Equity | ||
| Equity Accounts | ||
| Common Stock (NO PAR) | 466,910.60 | |
| Retained Earnings | (288,776.33) | |
| Net Income YTD 1995 | (59,604.45) | |
| Total Equity Accounts | 118,529.82 |
|
| Total Liabilities and Owners Equity | 148,944.29 |
|
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SolarAttic, Inc. Annual Stockholders Meeting 1996
The chairman had the following comments about the above financial statements: a) Most expenses on the income statement are related directly to the IPO attempt; b) The salaries and wages shown on the income statement were paid directly to Jim Kantorowicz as the company's only paid employee; c) Ed Palmer, the company's sole officer, at this time, receives no salary or wages. He is currently donating his services to the company. d) Ed Palmer is Officer Loan B shown on the balance sheet. During 1995, this loan increased by $7,500. Which is to say, Ed Palmer borrowed $7,500 from the company during 1995; e) The R&D expenses shown were incurred during the development of the new duct technology; and, f) Overall, nothing is unusual about the financials except that a lot was accomplished with a small amount of finances.
The chairman proceeded on to discuss the strategic plan for the company over the next 18-24 months as outlined below.
18-24 Mo. Strategic Plan
![[Image]](imgs/EDSRE_pict3.gif){kind=small}
Keep Pacing Business
Prosecute 4th Patent
Make Foreign Patent Application
Test some Sales Initiatives
Create Ventilation Product
Create Combo Space Heating/Ventilation Product
Raise additional private investment capital
Update Financial Model $100M/10Year
Resolve Securities Law Issue with State
Get Public ASAP
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SolarAttic, Inc. Annual Stockholders Meeting 1996
After discussing the strategic plan, the chairman presented an updated pricing schedule for the company's products. The new price structure allows the company to engage prospective distributors on quantities of 50 units or more. The company is currently talking with three prospective candidates who have expressed distribution interests.
The IPO will be attempted once again after the 4th patent is issued. The next time, however, the stock may be priced at $5.00 per share or more. Given the technology that was brought on board during the course of the IPO, it was readily apparent that the stock was undervalued. The chairman estimates the stock is now worth between 2-5 times the public valuation of 50¢ per share. SolarAttic will try to close the valuation gap internally with an update to its financial model. However, some restructuring of the capital stock may be required to achieve a $5.00 per share price. This is the minimum price required to obtain broader interest from the investment banking community [due to the SEC's penny stock rule]. However, it is not the only option available to get the company public. Clearly, the company has demonstrated that a public market exists for the company's stock. For SolarAttic, getting public is now mainly a matter of assembling the right resources and timing the offering.
The last slide the chairman presented was a small 1" ad that is scheduled to start running in Business Start-UPs Magazine. The magazine reaches 600,000 potential new business people. The ad will promote the company's business opportunity by selling an "Opportunity Kit" which is being assembled.
End Of Management Presentation
Adjournment
There being no further business or discussion, the chairman offered
to entertain a motion to adjourn. Larry Matthews made the motion to adjourn
the annual stockholder's meeting and Larry Garde seconded it. The motion
was unanimously approved and the meeting was formally closed at approximately
9:07 p.m.
Secretary Dated: February 23, 1996
SolarAttic, Inc.
2/23/96 Page 17 of 17
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