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Balanced Care Corporation
5021 Louise Drive, Suite 200, Mechanicsburg, PA 17055 * (717) 796-6100

The company was formed in April 1995 to develop senior care continuums which meet the needs of upper middle, middle and moderate income populations in non-urban, secondary markets.

Primary Underwriting Group
ManagerTierPhone
BancAmerica Robertson StephensLead Manager (415) 989-8500
Smith Barney Inc.Co-manager (212) 723-7300

Offering Information
NYSE:BAL Service: SIC 8361
Type of Shares:Common Shares Filing Date:10/14/97
U.S. Shares:7,000,000 Offer Date:2/11/98
Non-U.S. Shares:0 Filing Range:$9.00 - $11.00
Primary Shares:7,000,000 Offer Price:$6.50
Secondary Shares:0 Gross Spread:$0.46
Offering Amount: $70,000,000 Selling:$0.26
Expenses:$0 Reallowance:$0.10
Post-IPO Shares:15,606,343
Employees:2000

Legal Counsel, Auditor and Registrar
Issuer's Law Firm: Kirkpatrick & Lockhart
Bank's Law Firm: Shearman & Sterling
Auditor: KPMG Peat Marwick

Selected Financial Data

Dollar amounts in U.S. millions except for per share data
Full Year
Audited
Income
Latest
Unaudited
Income
Prior
Audited
Income
Balance
Sheet
6/30/97 6/30/97
Revenue:$49.48Assets:$33.84
Net Income:-$4.49Curr Assets:$24.77
EPS:-$0.56Liabilities:$22.04
Prior EPS:-$0.29Curr Liab:$9.10
Cash Flow/Oper:-$0.04Equity:$11.81
Cash Flow/Fin:$14.58Cash:$7.91
Cash Flow/Inv:-$7.20Working Cap:$15.67

Competition
The senior living and health care industry is highly competitive and the Company believes that competition in its current and targeted markets will continue to increase. The Company faces current and prospective competition for residents and patients and for employees from numerous local, regional and national providers of facility-based assisted living and long-term care, as well as rehabilitation therapy and home-based health care providers. Many of the Company's current and potential competitors are significantly larger and have greater financial and marketing resources than the Company. There are currently few regulatory and other barriers to entry into the assisted living industry. If the development of new assisted living facilities surpasses the demand for such facilities in particular markets, such markets could become saturated. The Company also expects to compete for acquisitions of additional assisted living and long-term care facilities and other senior health care operations. Competition could limit the Company's ability to attract residents and patients and expand its business and could have a material adverse effect on the Company's business, results of operations and financial condition.

Business Plan
The Company's objective is to be a leading provider of continuums of senior living and health care services in selected non-urban, secondary markets. In order to achieve this goal, the Company intends to: (I) Provide a Range of High Quality, Individualized Senior Care Services and Programs and (ii) Develop the Balanced Care Continuum.

Use of Proceeds
The proceeds from the proposed offering will be used to repay long term indebtedness, to fund the aggregate purchase price for pending acquisitions, for general corporate purposes including working capital and possible future acquisitions.

Principal and Selling Shareholders
Name of Shareholder% Owned
Before
% Owned
After
John M. Brennan0.140.08
Meditrust0.120.07
Brad E. Hollinger0.090.05
William R. Foster, Sr.0.090.05
Inter Vivos Trust of Billy Ray Foster0.090.05
F. David Carr0.080.05
Henry L. Hillman, Elsie Hilliard0.080.04
David K. Barber0.070.04
KD Investments0.070.04
Omega Ventures II, L.P.0.060.03
Robert J. Sutton0.050.03
Note: Represents ownership of 5% or more prior to the offering.
Executive Officers and Directors
Officer NameTitleAge
Brad E. HollingerChairman of the Board, President and Chief Executive Officer and a Director43
William T. McCarthyVice President45
Brian L. BarthVice President -- Acquisitions37
Russell A. DigilioVice President -- Assisted Living Group41
David K. BarberVice President -- Construction and Design43
Robert J. SuttonVice President -- Corporate Services and Secretary48
Roger A. Breedvice President -- Development48
Mark S. MooreVice President -- Finance and Treasurer36
Kurt A. MeyerVice President -- Health Care Group50
John D. FosterVice President -- Long Term Care47

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