Investment Portfolio

Current Financial Status and Strategy

DMC and Welch Allyn, Inc will invest $20 Million in cash each at the beginning in the SolMed, so it will have $40 Million cash on hand to develop and market the 1^st medical instrument product. Base on SolMed’s strategic initiatives and benefits from inheriting technology and engineers from DMC and Welch Allyn, the available cash will put SolMed in strong financial position to enable a quick product turnaround.

The financial strategy of the SolMed is aggressively set and begins to make a profit at the first year. The annual growth rate is set for 10% during the first 5 years.

Investment Portfolio

Investment	Category	Description	Strategic Initiative/LOB Map	Ttl Dollars (in millions)	EA Opportunity Comments
Communications Network	Corporate HQ	Implement corporate-wide integrated communications network in 2007	Promote Org Excellence	4.6
HQ Remodel	Corporate HQ	Corporate headquarters building in 2008 ($3.9 million)	Promote Org Excellence	3.9
Sales Competitor acquisition	Consumer Products Division	Competitor Acquisition in 2008-2009	Increase Market Share	25	Opportunity for common corporate systems approach with Medical Prod Div planned acquisition in 2008 (e.g. selection of common systems and migration approach to standard DMC Corporate systems)
New product center	Consumer Products Division	Implement new product development center starting 4th Qtr 2007	Increase Product Competitiveness	13	Opportunity to join with Medical Products Div in common approach to new prod development also in 2007
Solar Mini Cell Dev	Consumer Products Division	Development of more powerful solar mini-cell by 2008	Increase Market Share	1.3	Opportunity to join with Medical Prod Div in joint development of solar technology
Mfg Re-tool	Consumer Products Division	Re-tool manufacturing plant inherited from DMC in 2008	Increase Product Competitiveness	12.6	Photovoltaic Batteries – Smaller device form factor, more energy and longer photovoltaic battery life Solar Panels – larger storage capacity, more durable solar arrays/panels
Micro-cell Dev	Consumer Products Division	Development of modified solar micro-cell by 2008	Increase Market Share	0.8	Opportunity to join with Medical Prod Div in joint development of solar technology
Phoenix Sales Office	Medical Products Division	Open new sales office in Phoenix, AZ in 2008 ($430 thousand)	Increase Market Share	0.43
Product conversion of small device WelchAllyn product lines	Medical Products Division	Develop end-to-end industrial product development capability by 2007	Increase Product Competitiveness	5.3	Opportunity to join with Consumer Prod Div in common approach to new prod development also in 2007
Expand sales offices	Medical Products Division	Expand sales offices in Jacksonville and Los Angeles in 2008-2009	Increase Market Share	0.28	Opportunity to expand Division Sales offices in Jackson, Los Angeles and Houston
New Plant Development	Medical Products Division	Acquire new manufacturing equipment in support of new product line development	Increase Product Competitiveness	18.6	Product conversion of small device product lines obtained from Welch Allyn which utilized conventional power sources will speed development of high growth photovoltaic products
Total:				85.81