Today I spoke w/CEO Michael James in regards to a couple issues and here is what we discussed:
Regarding the current status of the share issue and restructured debt:
1) The total shares fully diluted is around 131 million shares
2) Each Series G Preferred share is equal to 250 common shares
3) The total Preferred shares if converted will equal to about 42 million common shares
4) There were about 18 million shares issued in warrants in the $.10 - $.20 range
5) There was also 9.3 million shares that were converted in the $.20 - $.25 range, with the majority around the $.20 area.
6) In Jan 2013 the company received Approx $2.2 million from the New Jersey Technology Business Tax Transfer Program that was implemented by Mr. James for moving the business to this area to take advantage of these tax benefits.
7) In Jan 2013 the Company paid off $1,141,500 of principal for notes that were outstanding as of December 31, 2012
In January 2013 the Company approved the issuance of 6,000,000 shares of common stock to certain officers and employees.
8) In January 2013 the Company bought the brands SlimTrim and Bikini Ready. The Company purchased these brands for cash consideration of $100,000 and 8,000 shares of Series G preferred.
9) In March 2013 the Company entered into a lease agreement for office space in Newark NJ. The future minimum lease payment for this three year lease are $37,800, $50,400, $50,400 and $12,600 for fiscal years ended December 31, 2013, 2014, 2015, and 2016, respectively.
Yes the company incurred a huge debt load prior to Mr. James taking over the helm and more as he began to reposition the company into a more income producing one, to sustain itself and payoff it's debt load. The first thing Mr. James did was to move the company to take advantage of the tax program that already brought in over $2 million dollars in revenue in January, with up to $3 to $5 million more to come. That was step #1 and step #2 was to buy more brands to increase sales & revs dramatically, whereas he bought Bikini Ready & Slim Trim in January. He has also been working on a huge deal for more than a year to get Martha Stewart to agree to them selling supplements with her name on them, which he finally closed in May of this year.
It is easy to see that Mr. James was making all the right moves to turn this company around in a hurry, in order that the company could rely on sales and revenue to fund its future growth, without the need to dilute shareholders or incur a bigger debt load. Now it is becoming ever apparent that Mr. James is succeeding and walking the talk, without any dilution! What more could you ask of any CEO?
As for the current situation surrounding the restructured debt, Mr. James knows many of whom bought the restricted shares and they are looking to get a nice return as they are well aware of the turn around taking place here, especially with the addition of "Martha Stewart Essentials", thus they will not be looking to convert their shares near the $.20 - $.25 area with the company in the midst of such a huge roll out ever witnessed by this company. A figure much higher is what they foresee, much the same as us shareholders here foresee, and for good reason.
I personally told MR. James I can see NRTI reaching $.50 to $1.00 in the short term if all continues to proceed as planned and the "Martha Stewart Essentials" really start taking off and he commented "if not even higher". He said they are all very excited around there as they continue to ship product to support distribution channels. He said he included the initial shipments that had already been delivered and invoiced in their recent 10Q filing, since it was a subsequent event that he wanted included right away to give investors and others a sense of where they are going with this business. They could even end up shipping more by years end than this company ever has since it's existence!
Now I think we can get a better idea of how NRTI will proceed from here, using revenues from sales growth to pay down its debt and fund the company going forward without the need to dilute shareholders, as made clear by Mr. James. He and his management team are doing a fantastic job and currently his sales team is out selling additional distribution opportunities behind the "Martha Stewart Essentials" launch, which Mr. James said will most likely open up additional opportunities to get their other brands into those retail chains.
He said he thinks Bikini Ready will be a very big brand for them also as they continue push forward. I asked if they were looking for additional brand opportunities and he said they are always meeting in regards to new products, but are currently concentrated on getting this current launch done right and that will be their main focus for the remainder of this year and into early next year.
He is checking on the progress of getting their website updated with the new "Martha Stewart Essentials" information and that it should be updated very shortly. He will also keep us advised as to any updates on new manufacturing facilities that they bring on-line.
I could easily tell during our conversation today that Mr. James was extremely excited about how this is all progressing and I admired how he did not try to avoid the issue regarding the company's debt. Much to my surprise, he talked openly and frankly in regards to the debt issue and the concerns the shareholders have about it. I think it is clear that Mr. James has his shareholders best interest in mind as he continues to turn this company around and I believe we will be greatly rewarded for being loyal shareholders down the road.
Cheers!
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AI
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