Mr. Gildea: Converted Organics began as a response to a Request For Proposals in the City of New York for dealing with the food waste that was going to be generated at a place in the South Bronx called Hunts Point. The city was moving the Fulton Fish Market from Manhattan over to Hunts Point, and they knew that as a result, they were going to increase the amount of organic or food waste that was going to be coming out of Hunts Point. So they put out an RFP. A company named ECAP, which is an environmental consulting business here in Boston, and another company named Weston Solutions, which is an engineering firm from Pennsylvania, responded to the RFP with a proposal to recycle the food waste into fertilizer. The City of New York has not acted on that RFP in the past eight or nine years, while Weston and ECAP saw the idea of recycling food waste into fertilizer as a good business model. So ECAP and Weston funded the initial efforts of the company. In those initial years, we found a site for a facility in Woodbridge, N.J., as part of the property operated by Bayshore Recycling, and we started work on our first permit for operating this type of facility, as there had not been one in the United States before this. We set about to find financing to operate the business. After a number of years of searching for private equity money, we found a source of financing through a public offering. So we did an initial public offering of our stock in February of 2007 and, at the same time, we issued a bond through the New Jersey Economic Development Authority to finance the construction of the facility in Woodbridge, N.J. In order to arrange for the bond to be issued, we needed to demonstrate the ability to sell the product. So in those efforts, we met a company in California called United Organic Products, and we began to have discussions with them about joint marketing efforts, and co-branding and all sorts of different ways of selling product. As a result of all those discussions, we decided it would be better for us and them if we, Converted Organics, acquired their business. So in January of 2008, Converted Organics acquired the business of United Organic Products. In doing so, we acquired their technology for the microbial digestion of food waste. They call that technology "high-temperature liquid composting." It's the same type of technology that Converted Organics originally had as a licensee in New Jersey, although it was a different application of that technology. So we were happy to buy it since we owned it instead of being a licensee. Now in 2010, we operate two plants, one in Gonzales, Calif., and one in Woodbridge, N.J. We sell the product that we make, predominantly in agriculture. The vast majority of our sales are in the agriculture markets in the West, in California down to New Mexico. We also sell product in the retail markets. Our product is available at Home Depot in 94 stores in the Northeast. We're available at Whole Foods in 84 stores in the Northeast and Mid-Atlantic, and we're available at an assortment of smaller lawn and garden, and nursery stores throughout the country through the distribution efforts of Arett Sales Company and a large distribution chain called the Gro Group. We also have our product available at Puerto Rico through SAM'S CLUBS and Wal-Marts. Finally, we sell the product to the professional turf markets, which is people that grow grass for other people to use, either landscaping companies, lawn and garden companies, or golf courses that use our product to create beautiful, verdant-green spaces with organic fertilizers as their base.
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