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Ann Arbor Angels drive $82M in new investments for area firms
4/27/2006

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The Ann Arbor Angels (A2A) investment group reported involvement in 26 transactions with total value of $82 million in 2005. Investment activity included $46.2 million in information technology sector related companies and $7.5 million in the life science sector. Companies representing the advanced automotive, consumer products, financial services, homeland security/defense, manufacturing technology, and nanotechnology sectors also received funding.

"Angel investment is critical to the development of new exciting companies in our state," said Michael Cole, vice president of the Technology Industry Group at Bank of Ann Arbor and managing director of A2A. "Southeastern Michigan's angel investment community is world-class and through the success of A2A we are pleased to now have an opportunity to provide this vitally important information to the public."

"The state of Michigan's angel investment community continues to demonstrate its strength and vision, evidenced by the companies and investments highlighted in the 2005 A2A investment report," said Jim Epolito, president and chief executive officer of the Michigan Economic Development Corporation (MEDC). The $32 million investment in ePrize was one of the largest angel deals in the Midwestern United States in 2005. Over the past century Michigan's angel investors have helped to launch automobile companies, chemical companies and cereal companies, providing the foundation for our great state's economic prosperity. The 21st Century Jobs Fund initiative will further boost angel investments in Michigan, at this critical junction, with the creation of capital gains roll-over incentives, pre-seed funds and commercialization investments. These programs will help Michigan's angel investors launch the companies that will drive our economy for the next 100 years."

Angel investment transactions of note in the region during 2005 included a $32 million third round recapitalization for interactive promotions agency ePrize. The transaction was lead by angel investors Gary Shiffman of Sun Communities; Brian Hermelin of Active Aero; and Dan Gilbert and David Katzman of Quicken Loans/Rock Financial/Cleveland Cavaliers, Camelot Ventures, with Bank of Ann Arbor providing $500,000 of pre-recapitalization debt financing.

"ePrize has been fortunate to work with the Technology Industry Group at Bank of Ann Arbor for more than two years. Michael Cole and the Bank of Ann Arbor stepped up to provide financing to ePrize when no one else would," noted Robb Lippitt, chief operating officer and general counsel for ePrize LLC. "They also introduced us to A2A and have been an integral part of our growth. Our region and new economy companies have a need for these kinds of services which The Bank of Ann Arbor and the A2A are doing a great job filling."

Machine vision company Coherix raised more than $6 million in 2005 utilizing the new Michigan Innovation Certificate of Deposit (MICD) angel-funding vehicle with Bank of Ann Arbor acting as the lead bank. A2A lead the angel funding with participation from Toledo, Ohio-based Core Network. Coherix has raised in excess of $8 million of a targeted $11 million to date.

"The A2A present a huge opportunity for the entrepreneurial community in Ann Arbor to lead at a time when leadership is going to be extremely important as we face the upcoming economic crises in Michigan," said Dwight D. Carlson, chief executive officer of Coherix. "A2A has started to take shape to provide leadership which will assist the administration of the University, the local community and State government deal with significant global economic development issues unique to the 21st Century."

Nano-particles company Nanocerox closed an over-subscribed $2.4 million Series B round. A2A lead the funding with participation from members of the Great Lakes Angels. Bank of Ann Arbor provided $240,000 of equipment financing and a $100,000 working capital line of credit.

"The A2A with Michael Cole taking the lead were most helpful to me and Nanocerox in our efforts to raise a round 2 funding," said Steve Swanson, chief executive officer of Nanocerox. "A2A provided a platform to organize an investor presentation and helped identify prospective angel investors. A2A is a vital link for early stage companies in their effort to find funding."

Flow cytometer device company Accuri Instruments closed an $800,000 Series A preferred equity transaction and a $1.5 million convertible debt round in 2005. Members of A2A lead the funding with participation from the Great Lakes Angels and Core Network. The company is currently closing an additional round of funding.

Among the other angel rounds participated in by A2A in 2005 were $1.5 million for laser navigation company Self Guided Systems, $1.5 million for drug discovery analytics company Genetics Squared, $420,000 for Pier 3 Technologies and $150,000 for Myrmidon Biomaterials.

Other key A2A funding and acceleration service partners during 2005 included Ann Arbor SPARK Business Accelerator, Amherst Fund LLC, Arboretum Ventures, Bodman LLP, CrystalPoint Partners, Dykema Gossett PLLC, Inovo Technologies, Plymouth Venture Partners, Menlo Innovations, Miller Canfield PLC, Online Technologies, Schox PLC and Seneca Partners.

Internet2 Selects Bank of Ann Arbor for New Health Savings Accounts
1/16/2006

Bank of Ann Arbor announced today that Internet2, the foremost U.S. advanced networking consortium led by the research and higher education community, has selected Bank of Ann Arbor to provide Health Savings Accounts for its employees adding to its already broad portfolio of benefits.

A Health Savings Account (HSA) is a bank account that is paired with a High Deductible Health Plan (HDHP). A HDHP plan, available from an insurance professional, typically has significantly lower monthly premiums than most traditional health plans. These plans require annual deductibles of at least $1,050 for single coverage or $2,100 for families. HSA's also provide participating employees an additional savings opportunity as individuals can save the money not spent on healthcare expenses, transfer their health saving accounts to another job, as well as earn interest tax free on their accounts over time.

"Internet2 has initiated the Health Savings Account program as part of our ongoing commitment to offer alternative benefits for our employees as well as to encourage health spending awareness," said John Kennedy, Internet2 Vice President for Operations. "Bank of Ann Arbor has remained a dedicated partner over the past six years in the growth of our business, and our selection of their HSA program demonstrates our continued confidence in their service offerings."

Bank of Ann Arbor has identified HSA's as an emerging product that employers will be turning to in order to reduce health care expenses. Some analysts predict that over 70% of employers will offer a HSA + HDHP program as part of their benefit mix in the next two years. "As a local provider of the HSA component, Bank of Ann Arbor can provide service and support for area organizations like Internet2 that cannot be matched by regional providers," said Dennis Ticknor, Bank of Ann Arbor's HSA Specialist. "Deposits with Bank of Ann Arbor stay in the community and are used to provide financing for individual and business needs right here in this community. This is truly a unique commitment that can be made by Bank of Ann Arbor."

Bank of Ann Arbor is taking a full service approach to its HSA product. Through a strategic partnership with HSA Solutions of Warsaw, Indiana, Bank of Ann Arbor will provide education, administrative support and tax reporting for the program. Bank of Ann Arbor's staff will educate employees and handle account enrollments at a business' location.

Led by more than 220 U.S. universities, working with industry and government, Internet2 develops and deploys advanced network applications and technologies for research and higher education, accelerating the creation of tomorrow's Internet. Internet2 recreates the partnerships among academia, industry, and government that helped foster today's Internet in its infancy. For more information about Internet2, visit: http://www.internet2.edu/.

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About the Ann Arbor Angels (A2A):
The Ann Arbor Angels is dedicated to bridging the gap between angel investors and the region's premier growth companies. The not-for-profit network founded by the Bank of Ann Arbor is supported by the Michigan Economic Development Corporation (MEDC) and Ann Arbor SPARK. Key collaborators include The University of Michigan Zell-Lurie Institute for Entrepreneurial Studies, Center for Venture Capital & Private Equity, and Office of Technology Transfer; the Ann Arbor IT Zone, MichBio and the Michigan Venture Capital Association.

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SPARK / Washtenaw Development Council CEO Named
10/04/2005

The Washtenaw Development Council (WDC) and Ann Arbor SPARK have named Michigan native Michael A. Finney president and chief executive officer of both organizations. Finney, of Rochester, New York, is currently president and chief executive officer of Greater Rochester Enterprise, the public/private economic development arm of the greater Rochester area.

"This is the culmination of an intensive, six-month search for a chief executive with a unique skill set," said Rick Snyder, chair of SPARK's board of directors. "Mike's track record in Michigan as vice-president of the Michigan Economic Development Corporation's (MEDC's) emerging business sectors division helps equip him to really 'jump-start' our effort," added Snyder.

Prior to accepting the Rochester position in October, 2002, Finney managed the MEDC's $1 billion Michigan Life Sciences Corridor initiative that provided seed and grant money to bolster the state's life science research and commercialization efforts. He held his vice-president post at the MEDC from 2000 to 2002. Previously, he was senior vice president and general manager at Thomson Saginaw Ballscrew Co. in Saginaw for thirteen years and, prior to that, Saginaw assistant city manager for three years.

The boards of directors of SPARK and the Washtenaw Development Council reached agreement in principle in July to search for a joint CEO to lead the two organizations. They also agreed to enter into a good faith effort to merge the two organizations next year. A joint search committee spearheaded the executive search and considered over twenty-five individuals for the post.

Finney established the Rochester, NY office in 2002 and built it up to a staff of ten with a $2.7 million annual budget. It encompasses nine New York counties with a combined population of 1.1 million people.

Bill Milliken, chair of the Washtenaw Development Council, noted that Finney's track record in business retention, attraction and fund raising was compelling. "Mike Finney's arrival opens the door and enables us to take our work at the WDC to the next level," said Milliken.

The Washtenaw Development Council is the lead economic development organization for Washtenaw County. A public and private partnership, the WDC is dedicated to providing a one-stop source of information and services for new, existing and relocating businesses in Washtenaw County.

SPARK is a non-profit organization focused on innovation and startup ventures. It has a three-year fundraising goal of $3 million to cover startup and operating expenses. To date, more than $2 million has been raised from business, academic, government and community partners including the University of Michigan, Eastern Michigan University, the Herbert and Grace Dow Foundation, Pfizer, Washtenaw County, the City of Ann Arbor, the Bank of Ann Arbor and the Michigan Economic Development Corporation.

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