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Stock Wizard Alerts Special Situation (www.stockwizardalerts.com) for
distribution after the stock market close, 5pm Wednesday May 30, 2001.
Meridian USA Holdings, Inc.
OTC BB: SYMBOL: MUSD
LAST SALE PRICE: $1.50
52 WEEK HIGH: $ 3.50
52 WEEK LOW: $ 0.51
SHARES OUTSTANDING: 6,380,000
PUBLIC FLOAT: APPROX: 3,600,000
MARKET CAP: $9,570,000
******************************************************
A FEW REASONS TO CONSIDER MUSD:
1) RECEIVED AN $ 8,000,000 INVESTMENT FROM U.S. BANCORP LATE LAST YEAR
(2000)
2) TEN YEAR EXCLUSIVE LICENSING AGREEMENT USING THE SWEET'N LOW BRAND
NAME FOR MUSD's SYRUP LINE
3) MAJOR CUSTOMER'S INCLUDE: KROGER, WINN DIXIE, SHOP RITE, STOP N
SHOP TO NAME A FEW
4) SWEET'N LOW� SYRUP'S IS NOW OFFERED IN MORE THAN 20,000 LOCATIONS
AROUND THE UNITED STATES
5) MUSD'S SPORT DRINK (ChampionLyte) TAKES AIM AT $2.4 BILLION SPORTS
DRINK MARKET
6) HIRED FORMER PRESIDENT OF YOO-HOO - CREDITED FOR GROWING YOO-HOO
FROM 500,000 CASES PER YEAR TO OVER 20,000,000 CASES PER YEAR
INVESTMENT OPPORTUNITY
The Company's holdings are Championlyte and the Old Fashioned Syrup
Company. MUSD manufacture's three flavors of sugar-free
syrup-chocolate, vanilla, and strawberry under the brand name Sweet 'N
Low, which MUSD has a license for. MUSD also manufacture's
Championlyte, which is a sugar-free, calorie-free, and
carbohydrate-free isotonic beverage (electrolyte replacing). It is a
sports drink similar to the big name brands. It replaces all the
electrolytes lost from dehydration, without calories, sugar, or
carbohydrates, and without artificial sweeteners, such as aspartame,
saccharine and sorbitol. There are no warnings on the label, and it is
safe for children. No sugar-free product is currently in the isotonic
market, which is about a $2.4 billion market, growing at 8 to 10
percent annually, according to Beverage Marketing of New York.
By being a one-of-a-kind product, MUSD is able to negotiate shelf
space without paying premiums.
MUSD has started to market Championlyte in the Northeast and in
Florida. MUSD also has sales in the Midwest and in the West, but are
focusing their advertising in New York and Florida to expand in
eccentric circles as they start to make their mark. That was the
Snapple brand formula.
The competitors are Gatorade and PowerAde, who between them control 95
percent of the market share, and a few other small brands and private
labels of those two brands.
Traditionally, when a sugar-free product goes into a supermarket, it
takes SIX to SEVEN percent of the MARKET SHARE.
There are some exceptions on the upside; for example, Diet Coke has 28
percent of the market share of Coca Cola. As far as the competition,
there is no other sugar-free sports drink having full electrolyte
replacement in the market. Gatorade and PowerAde, which are certainly
formidable, do not compete with MUSD on the same level. The lowest
amount of sugar that Gatorade has is 33 grams to a 20-ounce bottle,
whereas MUSD has 0 grams to a 20-ounce bottle. MUSD even see
themselves invading the Pedialyte market, which is electrolyte
replacement for children who are either sick with high fever or
stomach upset. Pedialyte advertises that they have 50 percent of the
sugar of Gatorade compared to MUSD with 0 percentage.
MUSD look's forward to joining the competition on the shelf as the one
that stands out as being very different. Right now, MUSD HAS NO
competition. When that does come about, they will welcome it. In the
rental car industry, Hertz only grew when Avis and the other groups
came in because they went from a specialty to a category, and that is
what could happen to MUSD. When people start advertising sugar-free
along with MUSD, it would drive more people to the sugar-free section
of the shelves and it could increase MUSD's sales as well.
VALUATION
Last year MUSD generated $ 1.2 Million in revenues on syrup sales
only, and lost money. In a recent article in The Miami Herald, Alan
Posner, MUSD'S CEO was quoted as saying, he predict's $ 6 million in
revenues during 2001 with the introduction of ChampionLyte. Posner
also went on to say that he expect's MUSD to be profitable by the end
of 2002.
According to Market Guide, MUSD is in the industry of Non-Alcholic
Beverages, companies within this group trade in the marketplace at a
ratio of 4.5 times revenues.
MUSD estimates $6,000,000 in revenues this year. At 4.5 times
$6,000,000, this would equate to a $ 27,000,000 Market Cap or a $4.22
STOCK PRICE based on approx. 6.4 million shares outstanding.
Another way to look at potential value, when a sugar-free product goes
into a supermarket, it takes SIX to SEVEN percent of the MARKET SHARE.
With the market currently at $2.4 BILLION and growing at 8 to 10
percent annually,
If over the next 6 month's MUSD were to be on target to capture 1% of
the market, with growth, the market would equate to approx. $ 2.7
BILLION and 1% would be $ 27 million in revenues.
Based on these assumptions, if MUSD were to trade in the Market Place
at 1 times revenues, this would equate to a $ 27,000,000 Market Cap or
a $4.22 STOCK PRICE based on approx. 6.4 million shares outstanding.
IF, OVER THE NEXT 6 MONTH'S, MUSD EXECUTES ON THEIR BUSINES PLAN AND
SUCCESSFULLY LAUNCHES CHAMPIONLYTE, AND THROUGH MUSD'S MARKETING
CAMPAIGN CREATE BRAND AWARENESS, WHICH COULD TRANSLATE INTO REVENUES,
THEN IF MUSD WERE TO TRADE TO $ 4.22 PER SHARE,
BASED ON TODAY'S CLOSING PRICE OF $1.50 THESE ASSUMPTIONS WOULD IMPLY
AN APPROXIMATE 181% PERCENT INCREASE IN SHARE PRICE !!!!
*******************************************************************
THE COMPANY
Meridian Holdings Launches Assault On $2.3 Billion Isotonic Drink
Market
MUSD was born out of customer driven requests for specific products.
It was also created from a personal awareness of consumer needs for
sugar-free syrups and sugar-free sports drinks. Through its unique
ChampionLyte the world's first sugar-free, carbohydrate-free isotonic
drink (electrolyte replacement) that has no fat or calories, Meridian
is taking aim at a $2.3 billion market that is growing annually.
Recently introduced, ChampionLyte is being welcome with open arms to
millions of diabetics, dieters and the nation's ever-growing
population of health conscious persons. What's more, people are
amazed to learn that the leading brands that dominate the category
contain 33 to 39 grams of sugar per 20 ounce bottle. Frightening
levels even to those who consume sugar sweetened drinks and food
products.
But to truly understand the phenomena of ChampionLyte, you need to
understand the genesis of the product and the years of effort and
capital that have resulted in this award winning, flavorful and
healthy drink.
It all began back in New York, when the Company principals, first
became friends. Both big fans of a drink called the Egg Cream - a
curiously parochial New York City area treat composed of neither eggs
or cream but rather milk, seltzer and chocolate syrup, they felt
strongly they could expand the reach of the drink beyond its
Metropolitan New York roots. To get things started, they founded a
franchise entity, the Old Fashioned Egg Cream Company to quickly grow
the company.
With custom-designed carts at sports arenas, shopping malls and other
high profile traffic locations, MUSD began offering their Egg Creams
to the public. They did this in venues such as Joe Robbie Stadium in
Miami, Madison Square Garden in New York City and other highly visible
locations. While marketing this wonderful concoction, both men
received numerous requests for low calorie, sugar-free egg creams.
These requests came not only from those dieting and health conscious,
but also from diabetics concerned about sugar content.
In order to have sugar-free egg cream, you need a sugar-free syrup.
It didn't exist. Taking a personal interest because of their own
diabetes and sugar intolerance, MUSD set out to develop their own.
By early 1998, after a great deal of research and development, MUSD
had their first sugar-free chocolate syrup for use in their egg creams
and to market to the general public. Success with their own brand
didn't come as quickly as anticipated. MUSD found that marketing a
"no-name" brand sugar-free chocolate syrup was not easy. It was
especially difficult to obtain shelf space with thousands of other
products competing for the same spots.
Sweet'N Low Helps MUSD Take Off
Faced with this obstacle, MUSD came up with the brilliant idea to
obtain the licensing rights to a well-known brand name for their
syrup. They selected the highly recognizable Sweet'N Low brand -
world famous for its small pink packets of sugar substitute. With the
Sweet'N Low name on MUSD's chocolate syrup, MUSD gained immediate
recognition in the industry and with consumers.
Realizing the popularity of MUSD's Sweet'N Low chocolate syrup, in
early 2000, MUSD expanded their syrup product line to include
strawberry and vanilla creme. This expansion of the product line
allowed MUSD to provide "rainbow packs" of their three highly popular
syrup flavors.
MUSD is currently researching additional Sweet'N Low flavors which
they hope to introduce in 2001. Today MUSD utilize's a wide variety
of marketing activities for the Syrup including trade publication
advertising, in-store promotions, retail incentives and sponsorships.
One example of cross promotions the company uses for product awareness
is a working agreement with Francis Anthony who is popularly known as
the "Love Chef." Under this agreement Mr. Anthony develops recipes
for the Syrup Company and does product promotions to build awareness
of Sweet'N Low Syrups.
MUSD also obtained the right to market Sweet'N Low Syrups as an
approved product of the Diabetes Research Institute, a national
diabetes research center located at the University of Miami. The
approval of Sweet'N Low Syrups at the Institute establishes its
worthiness to use the Institute's name on its products.
The syrups are now offered in more than 20,000 retail outlets around
the United States. It is a highly welcomed product by thousands of
diabetics and millions of diet conscious people.
In addition to domestic sales, MUSD negotiated an arrangement with
Cumberland Packing Corp., the owner of the Sweet'N Low name, whereby
Cumberland will act as the international distributor of its chocolate
syrup in many of the 43 nations throughout the world where Sweet'N Low
sugar substitute is marketed.
Moving Forward with Sugar-Free ChampionLyte
With the success of Sweet'N Low Syrups, MUSD began looking at other
categories where there seemed to be a "sugar-free" void. Amazingly,
they discovered the isotonic drink market - more popularly known as
"sports drinks" had no such product. Moreover, this was a more than
$2 billion annual market, but growing at a very healthy clip. In
fact, the isotonic drink category has grown annually since1996 and
remains a very strong product within the beverage industry according
to a Beverage World, a leading trade publication.
Understanding that diet conscious people and diabetics did not have an
isotonic drink, MUSD again turned to research and development. After
an intensive formula development process, they introduced ChampionLyte
in four flavors - fruit punch, orange, lemon-lime and grape. By the
third quarter of 2000, ChampionLyte was being shipped to retail
outlets in Florida and up the east coast of the United States and
beyond.
Putting ChampionLyte On The Map
MUSD has utilized a broad-base marketing approach to introduce
ChampionLyte. These strategies including ad placements in industry
trade publications, radio ads, food show and beverage show appearances
and establishment of a network of brokers. The natural tie-in of
isotonic drinks with active sports has lead to the pursuit of
sports-related ChampionLyte sponsorships. In early 2000 ChampionLyte
became the official refresher of USFans.com, a web site dedicated to
the interests of fans of professional and intercollegiate sports.
This sponsorship has given ChampionLyte prominent visibility on one of
the most heavily visited sports web sites on the Internet.
In October 2000, MUSD entered into a sponsorship and endorsement
agreement with Jay Fiedler, the starting quarterback for the National
Football League's Miami Dolphins. Under this agreement, Fiedler
provides various promotional services in connection with ChampionLyte.
Print advertisements for ChampionLyte are appearing in regional
editions of People, Sports Illustrated, Esquire, Road & Track, Car &
Driver, Field & Stream and Sports Afield. These magazine
advertisements feature Jay Fiedler.
MUSD has also created a 30-second television commercial for
ChampionLyte featuring Jay Fiedler and his "brother" Miami Heat
All-Star forward Anthony Mason as well as Jay's parents Ken and Donna
Fiedler. Ken Fiedler was Mason's high school basketball coach and
Anthony spent several years as a member of the Fiedler household.
In addition to the television commercial, ChampionLyte is being
advertised on the Howard Stern Radio Show in New York and Miami as
well as on the highly rated WQAM Neil Rogers Show in Miami.
ChampionLyte is also the exclusive sponsor of The Miami Herald's
All-County Sports Teams program.
MUSD has entered into a similar agreement with the world-ranked and
former world middleweight boxing champion, Dangerous Dana Rosenblatt.
MUSD continue's to pursue additional sponsorship relationships. Like
the Sweet'N Low� Syrups, ChampionLyte has qualified for sponsorship by
the Diabetes Research Institute and each bottle contains that
organization's seal of sponsorship.
Now that Sweet'N Low Syrups and ChampionLyte are making market
breakthroughs, MUSD is moving into the chocolate drink arena. To that
end, they have created a Meridian USA Holdings Chocolate Drink
Division. Their new entry into the chocolate soft drink category is a
milk-based product which they believe is more flavorful than other
branded chocolate soft drinks. In fact, MUSD feel's that the
chocolate drink market has been stagnant for the past couple of years
while consumer demand has been extremely strong. MUSD is confident
that with a quality product they will offer, they can make a
significant impact in a relatively short time. It's anticipated that
this drink will be available in the next few months.
Retail Market.
The market for MUSD's line of Sweet'N Low syrups is now offered in
more than 20,000 locations around the United States. Working through
its own efforts, as well as with international, national and regional
food brokers, Management anticipates that its Sweet'N Low line of
syrups will be marketed internationally through many local, regional,
national and international food retailers to consumers. The product's
target markets include consumers on medically imposed calorie or fat
restricted diets, diabetics who need to control their sugar intake,
and other self-imposed 'diet conscious' consumers. The principal
customers for the syrups are food retailers such as supermarkets, drug
store chains, discount stores, warehouse centers and institutional
entities such as U.S. Military post exchanges.
ChampionLyte is targeted at the same outlets as the syrups and
convenience stores, delis, fitness centers and health clubs. MUSD has
established a network of national, regional and international food
brokers to market its products.
Institutional Market.
An important market for MUSD products is bulk package sales to
institutional and food service customers such as hospitals, nursing
homes, schools, hotels, restaurants, ice cream and frozen yogurt
shops, baked and prepared food product manufacturers and sports and
entertainment venues. With an estimated 40,000 hospitals and nursing
homes around the United States, there is an excellent opportunity to
market the Company's syrups and isotonic sports drink. MUSD intends
to develop a significant 'institutional' markets for bulk sales of its
chocolate syrup product and ChampionLyte.
Private Labeling.
Under MUSD's agreement with Cumberland, MUSD has the right to package
and sell a percentage of its syrup production under the private label
of its customers. MUSD intends to pursue private label business for
both the syrup and the sports refresher drink with customers who have,
in the past, indicated an interest in this area.
International Marketing.
MUSD negotiated an arrangement with Cumberland Packing Corp. by which
Cumberland will act as the international distributor of the Company's
chocolate syrup in as many of the 43 nations throughout the world
where Sweet'N Low sugar substitute is marketed. This arrangement will
provide MUSD with international distribution on a very favorable cost
basis.
Future Products.
MUSD is actively developing other syrups and food flavorings using its
proprietary techniques. Subject to quality and taste testing results,
the Sweet'N Low license allows such products to be marketed under this
world-renowned brand name.
Manufacturing.
Presently MUSD has agreements with an independent co-packaging firms
located in Detroit, Michigan and Georgia for the production of the
Company's proprietary product. Additional co-packers are being sought,
and MUSD's long range plans include the possibility of acquiring its
own facilities.
Competition.
MUSD is not aware of any other manufacturer currently offering a
similar sugar-free, fat-free, cholesterol-free chocolate syrup product
with the same consistency and flavor. There are other brands of
chocolate syrup on the market, some of which advertise as fat-free and
or low-calorie, as well as the nationally and internationally known
brands of regular chocolate syrup, which could reasonably be
considered as competition for the Company's product. MUSD is confident
that its proprietary product, with targeted marketing under the
internationally renowned Sweet'N Low brand name will be favorably
received in the market place and establish the Company as a premier
purveyor of 'sugar, fat and cholesterol free' syrups and other
products.
Management
Alan Posner was elected as CEO, Secretary and Chairman of the Board of
Directors on February 24, 1999. Prior to that he was co-founder and
has served as CEO/Secretary/ Treasurer of The Old Fashioned Syrup
Company, Inc., its subsidiaries and predecessors since 1994. From 1973
to 1985 Mr. Posner was employed in various professional and
administrative capacities, including having served as the Senior
Associate Administrator at Brookdale Hospital Medical Center in
Brooklyn, New York. From 1985 to 1993 he was a principal of Medical
Care Administration, Inc. and Healthrac, Inc., multi-service medical
providers, medical management and consulting firms. From 1991 to 1994,
Mr. Posner was a member of the New York City Mayor's Advisory
Committee for Emergency Medical Services. He is a member of the
American College of Health Care Administrators, the American Public
Health Association and the New York Association for Ambulatory Care.
Mr. Posner received dual Bachelor of Science degrees (Biology and
Nursing) in 1971 and a Master's of Science Health Care Administration
in 1973 from the State University of New York at Stony Brook. From
1965 to 1968 he served in the U.S. Naval Hospital Corps.
Mark Streisfeld was elected as President and Director on February 24,
1999. He was co-founder and has been president of The Old Fashioned
Syrup Company, Inc., its subsidiaries and predecessors since 1994.
>From 1976 to 1989, Mr. Streisfeld operated a retail electronics
business in Monticello, New York, which he founded. From 1989 to the
present, Mr. Streisfeld has operated a multi-faceted jewelry
enterprise in Monticello, founded by him and his family. From 1973 to
1976 he was an elected trustee of the Village of Monticello. Since
1985 Mr. Streisfeld has been a Rated Jeweler by the Jewelers Board of
Trade and a member of the Advertising Specialties Institute. He is
currently a member of the Sullivan County (NY) Chamber of Commerce,
the Sullivan County Action Committee and the Board of Directors of the
New Hope Community for Retarded Adults (Sullivan County, NY).
********************************************************
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