Santeon Group Inc (SANT)

[TheYear2017]

Santeon Divests eBenefits Network Business
Sale Positions Company to Focus on Opportunities in Rapidly-Growing Agile Services and Outsourced Software Development Markets
http://finance.yahoo.com/news/santeon-divests-ebenefits-network-business-210000534.html


How much revenue is eBN generating? $56K/month? Divested price is 10 months of revenue. Quite concerning asset is divested before a new contract is awarded?

Curious if a direct contract will indeed occur. Santeon will continue to earn revenue under the MSA. Unclear on "Santeon will receive 20% of the first four (4) years value of such contract." If the contract value is $5 million over four years, what does Santeon get? Perhaps it should have said Santeon will earn a 20% royalty on profits. Or does the new business guarantee Santeon 20% of the work. If eBN is better off as a separate entity from Santeon, what were the restrictions it couldn't succeed at Santeon?


Notes from conference call:
400 providers on eBN
300 employers for a total half of million employees/dependents. Charge for employees 225,000 for about a $0.25/month. Is this per month ($56,250) or per year?
10 company licensing eBN - wholesalers (90%)
At the request of larger partners, conduct direct sales (10%)

On the positive side, Santeon gets $500K. What will the $500K be used for if we are a profitable company?

While I am a huge fan of Aigle, I need more info on "Rapidly-Growing Agile Services" when earnings our released. I am most interested in "Outsourced Software Development" as long as Agile has access to some IP. Or are we just building software for others and nothing for us? If Santeon does own IP, will this too be divested to other investors?

Overall questions, is $500K a fair price for eBN, especially with the debacle of healthcare.gov and the urgent need for healthcare benefits. I do hope a direct contract is signed with eBN. Last question is what portion of Ash's time will be split between the two entities?


http://biz.yahoo.com/e/131101/sant8-k.html
Form 8-K for SANTEON GROUP, INC.


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1-Nov-2013

Completion of Acquisition or Disposition of Assets, Financial Statements and



Item 2.01 Completion of Acquistion or Disposition of Assets.
On October 31, 2013, Santeon Group Inc. and its wholly-owned subsidiary, Santeon, Inc. (collectively, "Santeon") entered into an Asset Purchase Agreement with eBenefits Network LLC, a Delaware limited liability company ("eBenefits") whereby Santeon sold to eBenefits its cloud-based service division that automates the employee benefits enrollment process. This business was sold to eBenefits for $500,000.00 in cash, subject to post-closing purchase price adjustments.

Santeon's Chief Executive Officer, Dr. Ash Rofail, is a member of eBenefits.

Santeon completed the sale of these assets to eBenefits on October 31, 2013 and eBenefits paid the entire purchase price, with $100,000 being placed into escrow to cover any downward adjustment of the purchase price that may occur. As of now, Santeon does not anticipate that the purchase price will be reduced in any significant amount. However, Santeon could receive an increase to the purchase price in the event that a certain contract that is in the negotiation process is ultimately awarded to eBenefits. In that case, Santeon will receive 20% of the first four (4) years value of such contract.