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Public Company Investor Presentation. Trading Symbol: NBVG. The Next Revolution In Water. nutrient enhanced. W A T E R. Current Business Objectives. To secure funding to initiate the immediate launch of the Nu²0 beverage product.
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Public Company Investor Presentation Trading Symbol: NBVG
The Next Revolution In Water nutrient enhanced W A T E R
Current Business Objectives • To secure funding to initiate the immediate launch of the Nu²0 beverage product. • To establish strategic manufacturing locations where the patented organic cold-fill process (OCFP) can be utilize to support the launch. • To launch the Nu²0 product line in Arizona and Southern California initially; expanding to National distribution by the end of 2009. • To grow sales aggressively in the next three years. • To position the business for significant long-term sustainability and/or poise it for acquisition within the first 24-36 months.
Executive Overview • The Nu²0 nutrient enhanced water is the only such product in the market today with nutraceutical ingredients that tastes just like water. • The OCFP was patented in February 2005. • Twelve (12) proprietary formulations have been developed and are ready for immediate production. • Various contract manufacturing facilities have been identified and initial agreements have been negotiated. • Product packaging and graphics are completed and have gained favorable response from market research. • A detailed business plan including distribution, marketing and sales strategy is complete. • An experienced management, engineering and science staff has been assembled and is ready to proceed.
Executive Overview • To date, over $7.5 million has been spent on research and development related to this project. • Additional funding is required to implement the operational and marketing plans set forth. Product launch will only occur when full funding is in place. • Subsequent funding and/or operating lines of credit may be needed to expand production and distribution capacity to meet consumer demand in the event that the product is extremely successful. • In recent years, beverage acquisitions have accelerated as a result of the slow down in the sales of sodas and other traditional beverages thereby accelerating recent beverage acquisition activities. The company intends to position itself for acquisition as part of its exit strategy.
Executive Overview • Projected revenue and relative expenses have been planned to achieve operation profitability by the 4th quarter after the launch of Nu²0.
The Nu²0 Concept To utilize the patented OCFP to manufacture a variety of enhanced bottled water beverages under the brand name Nu²0; featuring no calories, no carbohydrates, no colors and no flavor other than that of pure water. This revolutionary concept is unique because no competitive beverage company can add organic Nutraceuticals without the addition of colors, flavors and sweeteners to mask the bitter taste of the ingredients and the preservatives. Research studies indicate that consumers are receptive to a new product similar to the perceived characteristics of Vitamin Water or Propel that do not have the added colors, calories, taste and preservatives of those two leading brands. Recent surveys have indicated both an interest and a willingness by retailers to place the product on their store shelves, providing consumers with an alternative to the current enhanced beverage offerings. The Nu²0 concept takes full advantage of the consumers’ transition to healthier beverages and an improved lifestyle.
The Nu²0 Green Initiative • Traditional methods of manufacturing beverages are not environmentally friendly as a result of the enormous use of energy in traditional hot-fill manufacturing plants. • The hot-fill process, which is required for safety and shelf-stability, is currently used in the manufacturing of virtually all existing beverage products. • The patented OCFP is a revolutionary breakthrough in environmentally sound beverage manufacturing, reducing the average energy use by 35%.
The Nu²0 Green Initiative • The Nu²0 product will be packed in boxes using recycled or biodegradable materials. • The patented OCFP allows for the beverage to be manufactured using less plastic in the bottles by as much as 50%. • The Nu²0 product will be manufactured using the latest biodegradable plastic materials available at the time the product is released in order to reduce the effects of our products in landfills.
The Patented OCFP (US Patent #6,855,358 B1; issued Feb. 2005) Purified water supply (ultra violet and reverse osmosis treated) Addition of secondary preservation ingredient (Copper salt or others) Ozonation treatment (0.2 to 3 mg/L ozone) Bottle Filling Bottle Capping (duration post capping (<1 min) Case packing, warehouse, shipping Syrup Formulation and re-hydration (67-75 brix) Syrup Heat Processing UHT temperatures (138-145° C for 2 to 8 sec) Shelf stable syrup. Storage in warehouse The following is a schematic representation of the actual patent as it appears in the filings. The process description as it appears in the patent filing is purposely general in nature and is not specific enough to allow for replication without additional information not listed in the document registered at the US Patent and Trademark Office. This information is currently unavailable through any public sources. 10
The Patented OCFP – Competitive Advantages Nu²0 can be bottled at a neutral pH for a more healthful beverage without an acidic reaction in the body. The OCFP enhances the bio-availability of the ingredients and prevents degradation which occurs with the hot-fill process. Nu²0 can be labeled “100%NATURAL, ORGANIC with NO PRESERVATIVES” giving it a significant advantage in today's market. As a result of the OCFP, manufacturing costs are reduced by 35% over Nu²0’s closest competitors providing a large increase in gross profit. The OCFP substantially increases the number of manufacturing facilities that can be utilized to make Nu²0. This increased manufacturing availability provides for a considerable logistical advantage and cost reduction.
The Nu²0 Exit Strategy • The company intends to strategically position itself for acquisition by minimizing the cost and size of its infrastructure operations. • Staffing and facility requirements will be kept to a minimum to facilitate a more rapid growth and reduce the requirement to layoff employees and shut down offices. • Large beverage company’s growth depends almost exclusively on the acquisition of new beverage concepts developed by entrepreneurial companies such as Nu²0. • “Pepsi and Coke don’t make acquisitions of these beverages companies because they can; they see the NEED to,” states Scott Van Winkle, director of investment banking at Canaccord Adams, Inc. Source: Health Business 2007
The Nu²0 Exit Strategy Evidence of acquisition enthusiasm has been measured by management through a series of meetings that have occurred since the development of the patent and the technology surrounding the product.
The Nu²0 Exit Strategy - Examples The following are examples of recent acquisitions and mergers within the beverage industry.
The US Bottled Water Market – Volume (gals) & Growth Steady growth over the past 2 decades is expected to continue. 1,504 1,478 1,349 999 974 691 124 **As of February 5, 2009 Source: Beverage Marketing Corp. – all results preliminary
The Market - Competition Top Bottled Water Brands
The Market - Consumption Global Bottled Water Consumption +8.3% Millions of liters +2.7% +2.4% Source: Canadean Global Soft Drinks Service; *Forecasted, **Projected
The Market – Wellness & Functional Beverages Wellness & Functional Beverages vs. Other Non-Alcoholic Segments Change in US Wholesale Dollar Sales % Change in US Wholesale Dollar Sales Source: Beverage Marketing Corporation Functional Beverages US Wellness and Functional RTD Beverage Market Gallons Per Capita
The US Flavored & Enhanced Water Market Sales of enhanced waters have grown 48.1% in the past year …particularly from new introductions 48.1% Enhanced water grew over twice the rate of the overall category! Source: Beverage Marketing Corp. – all results preliminary
Nutrient-Enhanced Beverages Nutrient-enhanced water is expected to reach $1.64 billion in sales by 2010 Furthermore, nutrient-enhanced water is outpacing trends in all other nutrient-enhanced categories, And the trend is expected to continue strong! Millions $$$ Source: Beverage Marketing Corp.
The Target Consumer • Existing bottled water drinker • Has tried enhanced waters, such as Vitamin Water and Propel • 29-55 years old (Gen X through Baby Boomers) • Health conscious • Knowledgeable and computer savvy • Mid to upper level income • Primarily women
Recent Market Research • Focus groups were conducted in 3 locations: • New York • Los Angeles • Phoenix • Key findings: • Excitement for a nutrient-enhanced, pure-tasting water • Concept seen as very unique as feedback indicates consumers recognize these attributes differentiate it from other bottled waters on the market. Source: Hall & Partners research study, July 2007 Qualitative market research was conducted to evaluate how the enhanced water with no color, flavorings, calories concept would resonate with consumers.
Recent Market Research - Competitive Mapping not flavored flavored enhanced SIMPLE ENHANCED WITH NO CALORIES NUTRIENT ENHANCED w/ CALORIES Limited knowledge about how they are enhanced but overall more innovative. Perceived to be vitamin enhanced (even though not) More Upscale Not Clear REGULAR WATER REGULAR WATER w/ HINT OF FLAVOR not enhanced More Upscale More Upscale Clear 23
Recent Market Research - Competitive Mapping not flavored flavored enhanced SIMPLE ENHANCED WITH NO CALORIES NUTRIENT ENHANCED w/ CALORIES • Consumers positioned Nu2O with SmartWater • because it is: • Enhanced • Clear • Flavorless However, it is similar to VitaminWater due to different combinations of vitamins and nutrients. Consumers best understand it as VitaminWater with no calories, color, nor flavor. Limited knowledge about how they are enhanced but overall more innovative. Perceived to be vitamin enhanced (even though not) More Upscale Not Clear REGULAR WATER REGULAR WATER w/ HINT OF FLAVOR not enhanced More Upscale More Upscale Clear 24
Recent Market Research Consumer testing indicated that Nu²0 is indeed in a category unto itself, somewhere between SmartWater & VitaminWater Only a few consumer products have the ability to define their own category
The Evolution of Nutraceutical Beverages “As a result of its patented technology, Nu²0 has created the first true innovation in the beverage industry in last 50 years.” Howard Gill, Scientist “Although the functional beverage category is indeed growing by leaps and bounds, there is surprisingly not a lot of true innovation taking place. The market seems to be growing by virtue of ‘me too’ products…” Rebecca Wright, Nutraceuticals World
The Initial Family of Nu²0 Products The following formulas have been developed for immediate initial launch. • ENERGY • COMPLETE • IMMUNE
Additional Nu²0 Formulations Nu²0 has prepared three additional formulations which will be introduced into the market place after the second quarter of operations. • WEIGHT CONTROL • SPORTS • JOINT Note: These formulas are proprietary information and can be reviewed only after non-disclosure agreements have been signed.
Additional Nu²0 Formulations Nu²0‘s science team is near completion with the following formulations all of which Nu²0 intends to introduce into the market within the first 12 months of operation. BRAIN STIMULATION PREHYDRATION WORKOUT DRINK HEART HEALTH EYE HEALTH DIGESTIVE HEALTH BEAUTY IN A BOTTLE Note: These formulas are proprietary information and can be reviewed only after non-disclosure agreements have been signed.
Cause Marketing Products Nu²0, where appropriate, intends to jointly develop and market products in conjunction with many worthwhile and high profile causes.
Licensed & Private Label Products Private label products provide a unique entry into specific market segments and niche markets that are other wise controlled by a single business entity.
Distribution Opportunities • Since 1990, Nu²0 management has retained relationships from prior business experience with all major retailers in North America and in most Asian and European markets. • Major US retailers continue to express considerable interest in experience with all major retailers in North America and in most Asian and European markets.
Contact NutriPure Beverages Kenyatto Jones - CEO 1300 Bristol Street North, Ste 100 Newport Beach, CA 92660 info@nutripurebeverages.com Nu²0 Headquarters Office: 480.272.7290 14301 N. 87th St. Suite 301 Scottsdale, AZ 85260