NEW BROOM SWEEPS CLEAN
"MacDonald and Walgreen" Pronounce the current HealthRite
Management Fifth Letter as "False, Inaccurate, and Grossly
Misleading." Bradley T. MacDonald continues to stand up to
Founders Management Services, Inc. and criticizes the
self-dealing of Messrs. Haber and Teeger!
Bradley T. MacDonald and Charles R. Walgreen, Sr. are Co-chairmen
of a committee seeking to elect a new board of directors to
HealthRite Inc. (HLRT). In opposition to current management's
proposed slate of directors. HealthRite manufactures and
distributes nutritional food supplements under the tradenames
Montana Naturals, Pure Energy, and Medfast (registered trademarks
of HealthRite) and Nautilus Nutritionals (registered trademark of
Nautilus Inc.)
The directors proposed by Messrs. MacDonald and Walgreen include,
Industry leaders who have access to retail and wholesale decision
makers who can strategically guide this company to profitability.
MacDonald and Walgreen urged shareholders to compare the quality
of the proposed board to the current board and what they can
bring to the table.
The content of the current board's "fight letter" is "Inaccurate,
Grossly Misleading and False." "There is another side of the
story," explained Mr. MacDonald," While we deny the misleading
statements of our opponents, we will refrain from a lengthy
rebuttal. Instead, as we stated in our proxy statements, we will
emphasize HealthRite's extraordinary opportunity in the
marketplace if we elect a proactive board of directors like the
one we have nominated. We urge our shareholders to vote for the
"MacDonald and Walgreen" opposition slate by signing and mailing
the GREEN PROXY.
Our Position is simple: The record of the current board, looking
out for the interest of shareholders, is dismal. It is run like
a small private company but with public money. Three presidents
in 4 years and numerous management changes speak for themselves.
There is plenty of blame to go around, but the real culprit were
the severe losses in the Vitamin Specialties retail operation,
the previous bankruptcy of Jason Pharmaceuticals and the lack of
capital to execute the HealthRite marketing plans. Dun and
Bradstreet reports, available to retailers, rated the company as
a "High Risk" to do business with because of its poor payment
record. Until Mr. MacDonald asked Uncle Sam to give the company
a guaranteed loan, no banks would lend HealthRite money and Fleet
Bank wanted out of its loan agreement.
When Jack McGowan, Sr., Vice President of Sales, joined the
company he asked Messrs. Haber and Teeger, if he increased sales
opportunities, could "Founders" obtain the necessary funding to
support the growth of the company. They answered "yes." Despite
being 5th Avenue investment bankers, "Founders" failed to
convince Fleet Bank to continue lending the company money, even
for the Walmart project. Worse, they failed to use their
resources to obtain financing from other sources.
Anybody who knows the retail and distributor business realizes
the "Experience" and "Contacts" are the essential elements that
ensure success. The resumes of our board are impressive and we
have the contacts to improve the capitalization and sales of
HealthRite and increase the value of your investment.
Messrs. Walgreen, Panasci and Green do not associate with
amateurs and people who do not have a passion for what they do.
Mr. Hauge, founder of Montana Naturals, intends to help the
company develop the care "HealthFood" segment that needs
revitalization and expertise.
Current management are people with a vision and resume to get the
job done. The current management is applying character
assassination techniques to distort the reality of the real
condition of the company. Our board is the only hope for
positive change that will increase the value of your investment.
All the other false charges will be privately handled by our
attorneys. We will continue to take the high ground and ask your
support based on our qualifications. If we can get "Sales and
Capital" and conduct ourselves like a publicly held consumer
products company instead of a "Venture Bankers" enterprise, we,
indeed, believe HealthRite can and will be a profitable business.
For 3 years, "Founders" refused to break out their specific
"retail" losses to the shareholders and manipulated the
"corporate" administration expense and spread it over all
divisions. The numbers in their fight letter are "Unaudited" and
manipulated by "Founders." They lack credibility and are suspect.
We appreciate the loyal employees of the company who have not
taken sides and particularly the ones with stock who hope to
improve their lot someday on their investment. We apologize for
the tension caused by this proxy fight, however, it is necessary
for the future of the company. The committee values your work
and looks forward to providing a winning strategy, improving the
capitalization, and therefore insuring am ore secure future.
The current board controlled by "Founders Equity" is primarily
concerned with "cash flow, transaction fees, and their precious
management services agreement (including a Lexus and Mercedes for
Messrs. Haber and Teeger, Chairman and Vice Chairman)." On the
other hand, Mr. Hauge, owner of over 170,000 shares, the founder
of Montana Naturals has invested years of sweat equity. He
acquired HealthRite stock for over $4.50 a share when he sold his
company. The stock is now trading for under $2.00 per share.
Mr. MacDonald has invested over $150,000 of his own money in the
Company.
Messrs. Haber and Teeger received virtually all their stock as
compensation for transaction fees. The Co-Presidents appointed
do not have any investment in HealthRite except stock given as a
bonus last year as of August 97. The current board has marked
down their options for outside directors twice in recent history
and is requesting another markdown for a vote at the annual
meeting. For What?
In conclusion, the committee asks for your vote because we
believe that it is the only way to build HealthRite into a
successful business and to increase the value of the Investment.
The Committee respectfully requests your votes at the annual
shareholders meeting at the Resident Inn by Marriott, at 10710
Beaver Dam Road, Hunt Valley, Maryland 21030, at 10:00 o'clock
a.m., December 17, 1997.
Send in your "Green Proxy" card voting for "MacDonald and
Walgreen" and Associates in opposition to the incumbent
HealthRite board of directors. Mail it 2d day UPS if possible.
Protect your Investment! Elect a new Board!
If you have any questions call Beacon Hill Partners
1-800-755-5001.
