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Dear Shareholders,
On August 13, 2007 Organetix entered into a definitive share exchangeagreement ("definitive agreement") to acquire a 100% interest in New York-based media firm KidFitness, Inc. ("KidFitness"). Since then I have workedvery closely with the management of KidFitness towards establishing a reliableroadmap to satisfy the closing terms set within the definitive agreement. Ihave the greatest respect for the management of KidFitness and theircommitment to building both a strong national brand and a viable solution tocombat childhood obesity. Through a previously announced partnership with TheUnited Way, the KidFitness "Fun Fitness Break" will be provided with theassistance of corporate sponsors (free of charge) to public school classroomsK through 5th grade across the country. This represents an unprecedentedbranding opportunity, as millions of public school students are expected toexercise -- every day for 7 minutes -- to the KidFitness branded content. Weexpect this to translate into extremely lucrative licensing opportunities forKidFitness, including leveraging the brand equity into multiple product lines.
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It is important to discuss the status of the definitive agreement, signedby both Organetix and KidFitness on August 13, 2007. There are variousclosing terms set fourth in that agreement, the most significant of which isthe completion of a $7 - $12 million private placement by Organetix. Thepurpose of this capital raise is to provide KidFitness with the requisiteworking capital to improve existing content and aggressively pursue revenuegenerating partnerships and licensing agreements. Despite current weakness inthe share price of Organetix, I remain confident that Organetix willsuccessfully complete this private placement at terms that are reflective ofthe value of KidFitness. Raising capital is about proving the fundamentalvalue of a business to both sophisticated institutional investors andaccredited individual investors. It is the responsibility of management tosell its vision to the investment community and create shareholder valuemoving forward. Recently, there have been a number of constructive meetingswith institutional investors and ongoing negotiations are currently takingplace, with respect to potential financing terms.
My short term goal is to provide the shareholders and prospectiveinstitutional investors with a better understanding of the fundamental valueof KidFitness, as a business opportunity. I am working diligently with theKidFitness management team to provide the public with meaningful updates, tobetter establish valuation criteria for the Company. Under terms of thedefinitive agreement, Organetix has until the middle of November (2007) tosatisfactorily meet its closing obligations. This should provide the Companywith sufficient time to overcome inherent market volatility and properlydemonstrate the value of the enterprise. I believe the KidFitness' businessmodel represents a compelling opportunity to create shareholder value in boththe shorter and longer terms. I greatly appreciate the continued support ofour shareholders as we work towards completing the transaction in a timelymanner.
In addition, KidFitness CEO Paul Neville, added the following statement:"I am fully committed to completing this transaction with Organetix andcreating value for shareholders of KidFitness. I will work very closely withMr. Shaw and his management team in exposing the significant value ofKidFitness to the investment community. I am very excited about the businessopportunities that lie ahead for KidFitness."
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