Once LLSR is in position to launch into production, another opportunity awaits them (and their investors)...... LLSR will utilize the mainstream dental platform distributors who already have existing relationships with dental offices worldwide. There is one dominate distributor in Europe (>65 % market share). They are also one of three primary distributors in North America. These distributor's offer a variety of services to our end customers including:

1. 1-2 finished goods units in inventor (accelerated delivery).

2. Offer loan services to the end customer.

3. Install, Train and Service the end customer.

In turn, LLSR benefits from the following:

a). Low Overhead/Small Streamline Organization: LLSR will most likely subcontract the manufacturing of the OCT/NIR systems and key modules. LLSR will most likely rent a small-to-medium size final assembly/final test facility with lab/offices (unless their is a compelling reason to buy). A reasonable location would be near their key supplier (Axsun). I'm not familiar with the Boston area, but I believe Axsun is in a technology zone of some sorts (providing some kind of business benefit) and provides LLSR one of two key modules (lightlab's laser the other..... and perhaps the hand wand developed by UF). LLSR will not have to establish as large a sales/marketing/customer service workforce meaningfully reducing company overhead. It will be a streamlined business operation with low overhead components.

b). Reduced Marketing Costs: While LLSR will advertise thru key dental magazines, the distributors will mass market the end customers with a spirit of competition to gain market share. I'm assuming that dental platform distributors attend the key industry trade shows. If so, LLSR would have reduced trade show expenses since the distributors would most likely set up demonstration units at their booths. Just think, a dentist is attending a symposium/trade show to earn continuing education credits. He wanders past the distributor's demonstration booth..... sits in the chair (sees his own teeth on the monitor)...... and experiences an OCT/NIR scan as the distributor sells him on the many benefits (no radiation, replaces 70% of x-ray applications, detects cavities up to two years before x-ray, insurance codes available, loan program, can deliver next week, detects soft tissue issues.... and most important... increase your revenue)... talk about a captive customer!

c). Existing Relationships/Accelerated Time to Market: LLSR does not have to start from scratch creating relationships and selling the product to the end customer. These distributors have already sold, trained and installed dental platforms and aggressively protect their turf (their existing customer base). LLSR will build brand awareness thru industry specific trade magazines..... and remember that dentist at the trade show.... well.... he just came from or will be going to a lecture on OCT/NIR to earn his continuing education credits (lecture perhaps by Craig Gimbel or a key dental scientist who writes papers on OCT or NIR... like Dan Fried).....

d). Inventory/Forecast/Cash Flow: I'm assuming for the initial launch, there will be only three distributors as I mentioned earlier in this model. Over time, LLSR will have to add additional distributors to cover country specific locations like Korea or Japan...etc. It will be the distributors who provide the rolling monthly forecast. Their forecast triggers some prearranged inventory program consisting of finished goods at the distributor, finished goods at LLSR's facility and some level of WIP. While we may be talking about small quantities at each inventory bin, we are also talking about large dollar systems. LLSR will be able to efficiently manage a few system part numbers (various system configurations of NIR and OCT units), streamline their production flow and hence optimize cash flow..... Life is much easier when you only manufacture a few high dollar part numbers.

Hope your getting a forward view of launching the product and earning that first level penetration rate of early adopters per the LLSR model (LLSR's penetration rate of 5% over four years is a low ball. Meditec achieved ~ 10%) .... while we watch the stock value grow!

Just another reason why I'm,

Enlightened