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Military Resale Group, Inc. Corporate Profile: January 2002 2180 Executive Circle Colorado Springs, CO 80906 Telephone: 719-391-4564 Facsimile: 719-391-4565 Ticker Symbol: OTCBB - MYRG Shares Outstanding: 6,630,004 Estimated Float: 1,220,004 52 Week Range: $2.27 - $0.03 Company Contact: Mr. Ethan D. Hokit, President ------------------------------------------------------------ - Military Resale Group, Inc. (OTCBB-MYRG) recently became a "new" publicly-owned company as a result of its acquisition in December 2001 by Bactrol Technologies, Inc. MYRG markets and distributes groceries and related products to commissaries on U.S. military bases in the Colorado area, where our operating roots go back five decades. Previously a publicly-traded corporate shell, Bactrol Technologies acquired Military Resale Group in a reverse acquisition, leaving 6.6 million shares outstanding and only 1.2 million shares in the public float. MYRG was incorporated in 1997 when it acquired Pittock Distributors, Inc., a fifty-year old firm specializing in distribution of products to the Military Resale Market. At the time of the acquisition of Pittock, it had approximately $750,000 in revenue. Revenue has increased over five-fold (5x) in the past four years reaching $4.8 million in 2001. MYRG believes that revenue can increase to a $12 million annualized rate by the end of 2002 with the existing facilities. President Ethan Hokit and GM Bob Hefner have each been in the local military resale market for over 25 years. The Military Resale Market is a $15 billion niche market with 13,000,000 authorized patrons, which operates under the aegis of the Defense Commissary Agency (DeCA), a Department of Defense (DOD) agency. The DOD's objective, in this activity, is to operate resale store systems that sell groceries (at commissaries) and general merchandise (at exchanges, i.e., PXs) at the lowest possible prices. The resulting average cost savings last year of 30.4% make the system a major fringe benefit (untaxed) to military personnel. The competitive structure of the Military Resale Market consists of a few large distributors that do not dominate the industry, and hundreds of smaller distributors. MYRG's long-term strategy is to grow, primarily by acquiring other small distributors, and also by internal growth. Positive Investment Theme 1. The Military Resale Market for groceries-merchandise is a $15 billion a year niche industry. -13,000,000 authorized patrons benefit from lower prices (about 30%) and on-post shopping convenience. -Demand is cyclically stable due to the basic product nature and military headcount. -Distributors require some specialized knowledge - a barrier to entry - in this industry regulated by DeCA (Defense Commissary Agency). 2. The shares possess several appealing investment features. A. They are statistically attractive, as measured by the Market Value/Sales Ratio. -MYRG's market value is currently about $2.0 million. This is only .4x actual 2001 sales of $4.8 million and only .3x projected 2002 sales of about $6.5 million, which is well below the level of the Market Value/Sales ratio for most stocks. B. The float is thin, containing only 1.2 million shares. C. A stock play on the Military Resale Market is a "new" idea to investors and is defensive in a weaker economic setting. MYRG has set a target of reaching a trading range of $4.00 - $5.00 per share by year-end 2002 so that it can seek a national exchange listing.
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