The Best Press Release of 2007: A Sentimental Journey with J. Lloyd Tomer
Yes, I know what you’re thinking.
You’re thinking, how in the world can I declare “Best Press Release of 2007” only 42 days into the year, with another 230 or so business days remaining before the year 2007 officially ends?
Get a load of the following explanation for a stock sale, excerpted from a press release which hit my Bloomberg late last week, issued by a company called “YTB International.”
“Coach Lloyd Tomer sold his dream home a few years ago to help fund YTBI at a critical time inthe Company’s growth. A few days ago he regained ownership of his dream home by giving one million shares of YTB International, Inc. stock to the person he sold it to, John Simmons. In return, Coach got the real estate back.” —YTB International Press Release, 2/8/07
I make none of that up.
And while I certainly expect there will be some hefty competition for the title of Best Press Release of 2007 in the weeks and months ahead, I can’t imagine a more hilarious example of the dumbing-down of corporate America than the full release, which was headed as follows.
YTB INTERNATIONAL Chairman Provides Clarification Re: Real Estate
Press release “Clarifications” are always worth a glance, no matter what the company—even one so obscure as YTBI, which describes itself as follows:
ABOUT YTBI: YTB International, Inc. provides Internet-based travel booking services for travel agencies and home-based independent representatives in the United States, Puerto Rico, and the US Virgin Islands. It operates through three subsidiaries: YourTravelBiz.com, Inc., YTB Travel Network, Inc., and REZconnect Technologies, Inc. Googling “YourTravelBiz” brings up a “YTB Demo Site,” which kindly provides the YTBI closing stock price ($9.20), but only fairly limited information about the exact nature of the business itself. See if you can figure out what the business of this company is:
The YTB companies offer two unique and powerful business opportunities, that of referring travel agent or “RTA” and that of independent marketing representative or “REP”. The travel agent opportunity has an initial fee under $500 and a monthly license fee of $49.95. There is no fee or travel agency purchase required to be a REP. You may choose to participate in one or both opportunities. Hmmm. Does that smell like one of those direct-selling pyramid things to anybody?
Fortunately for the skeptics among us, the YTB Demo Site publishes a vast array of testimonials from satisfied customers, in a section titled “Testimonials.”
At the risk of boring our readers, I will reprint all the Testimonials from that front page, for the sake of accuracy. Bear with me. Here goes:
“YTB gives anyone who wants it, fun, financial freedom, and time with their FAMILY!” –Kevin Adams That’s it.
Now, before you rush out there and join Kevin Adams to get some of that fun, financial freedom, and time with your FAMILY, I suggest you read the full text of the press release in question, the one “clarifying” the recent “real estate transaction.”
WOOD RIVER, IL — (MARKET WIRE) — 02/08/07 — YTB International, Inc. (“YTBI” or the “Company”) (PINKSHEETS: YTBL) and its Chairman of the Board, J. Lloyd Tomer, provided clarification today regarding Mr. Tomer’s disposition of 1,000,000 shares of YTBI’s common stock in payment of the purchase price in a real estate transaction that had closed in January 2007.
Seems Mr. Tomer sold 1 million shares at $6.69 a share on January 24, which is not a bad gig for a company with no quarterly earnings reports that I can find since year-end 2005.
On the surface, Mr. Tomer’s sale might look a little opportunistic, considering the fact that the stock had doubled in three weeks. Furthermore, it constituted about a quarter of Mr. Tomer’s reported holdings, leaving him with 3.28 million shares.
Not to mention the fact that early in 2006 the company had “initiated an internal inquiry” into “accounting-related matters” causing the company to report, in a recent 10QSB/A, that it “needed to restate certain of the Company’s financial statements.”
The phrases “material weaknesses” and “deficient controls and procedures” appear as well, along with the fact that the company’s previous accounting firm “had provided prohibited services and appeared to have not followed the standards of the Public Company Accounting Oversight Board…”
However, YTBI wants to set the record straight: turns out, the sale had nothing to do with the price of YTBI stock or Mr. Tomer wanting to sell while the selling was good, nor the “material weaknesses” or “deficient controls.”
It has to do, instead, with getting back “his dream home.”
I am not making that explanation up.
As required under federal securities laws, Mr. Tomer filed a Form 4 disclosing the transfer of the shares as part of the purchase of a piece of real estate. While the disposition of the shares was technically deemed a “sale” under the rules that govern Mr. Tomer’s SEC filings, in reality the shares were merely used as a means to purchase a piece of property that had long-standing sentimental value to Mr. Tomer. The Company released the following statement in clarification of the true story behind the share disposition: “Coach Lloyd Tomer sold his dream home a few years ago to help fund YTBI at a critical time in the Company’s growth. A few days ago he regained ownership of his dream home by giving one million shares of YTB International, Inc. stock to the person he sold it to, John Simmons. In return, Coach got the real estate back.” And that’s it.
Now, until a week ago I knew nothing of YTBI, and today I know only slight more than nothing, aside from what is quickly and easily at hand on my Bloomberg.
But I know this: a sale is a sale is a sale.
And I know this is the Best Press Release of 2007…unless YTBI has another one up its sleave.
Jeff Matthews I Am Not Making This Up
© 2007 Jeff Matthews
The content contained in this blog represents the opinions of Mr. Matthews. Mr. Matthews also acts as an advisor and clients advised by Mr. Matthews may hold either long or short positions in securities of various companies discussed in the blog based upon Mr. Matthews’ recommendations. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author.