From Roundmott:Summary or the meeting...
Much of this has been covered but will start at the top of my notes
anyway.
Sales in U.S. and overseas increasing.
We are making 30" and 40" substrates.
The 30" is currently being sold in the U.S.
The 40" is currently being sold overseas to a company that is
developing a large screen TV.
The 12" substrate is still the favorite.
They have grown CNT on their own sustrates before. And Fayiz talked
as though they have already developed the prototypes for 6", 8", and
12" CNT displays.
Glass based displays are our only real competition. They are ideal
for small displays like those in pagers, cell phones, hand held games,
calculators, and PDAs. But begin to have problems when they are put
into larger items like laptops and TVs. The problem is that the
circuitry must originate from the side of the glass. And by the time
the circuitry reaches the far extremes of the glass the image looses
brightness and contrast. To offset that problem they can either put
another circuit for the other side or lower the bright portion to
match the darker far side. The second circuit of course increases
cost. And in even larger displays it does not eliminate the problem.
Ceramic doesn't have that problem because they can drill holes in the
ceramic and originate the circuitry across the entire surface.
Cetek developed a special method of sintering their ceramic. That
special method has reduced the sintering time from 15 days to 3. Our
ovens therefore must be built special. The problem is they can cost
over $500K AND it would require Cetek to tell others their secret.
Therefore, we build our own for only $200K.
We currently have 6 ovens on line. Fayiz would not tell us how many
shelves they have or how many substrates they will hold on each tray
or total. I won't tell you the reason he gave for not telling us. I
don't want to insult your intelligence or cause you to doubt his. Let
me just say that dumb doesn't adequately characterize his answer.
I previously had assumed that they had 8 ovens. I was wrong.
We still assume from comments by JS that they have multiple shelves
and have an internal measurement of approx. 5' x 5'.
Fayiz did make the comment that there were times that they only have
one substrate on a shelf. I assume therefore that he was talking
about the 40". If that is true then IMO we can assume that that same
shelf will hold three 32" substrates each direction or 9 per shelf.
He said the the ovens are running 24/7 364 days a year. They are
turned off one day a year for maintainance.
He also told us that they have a 90 gal mixer to mix the ingredients in.
The Poughkeepsie facility is currently maxed out, and Fayiz said that
the are not making making substrates at any other location. However,
he said that they have room for 6 additional ovens and construction on
them has already begun.
They have 22 employees including Fayiz, but not including JS and RL.
But they are not always there. Since the ovens have to bake the
substrates for 3 days, there are times when the whole crew is not
needed. There is someone there 7 days a week.
The preliminary audits are finished for the years 2001, 2002, and
2003. They must now be certified.
We have entered into some kind of research partnershiip with GE to
develope fuel Cells using Cetek ceramic.
The agreement with MOT is dormant right now. According to Fayiz,
Cetek paid MOT money for their intellectual property but never
received it. They then stopped paying, and MOT subsequently cancelled
the agreement. That explains why MOT tells us that the original
contract ended because Cetek did not pay them. Fayiz says that they
are hoping to finally get the property in a few months.
But he also said that Cetek will be able to go forward with most of
there plan without them.
Fayiz played the SEC card again when trying to explain his lack of
informative PRs. I do not believe him. IMO it is more likely that
Fayiz has been submitting his PRs to Laskowski for approval. And he
has automatically rejected anything that even looks like details on
the pathetic grounds that the SEC will require proof. AS IF THE SEC
HAS EVEN A SINGLE SECOND TO MONITOR A SUB-PENNY STOCK. I donnnn't
think so.
The 500 million share buy back was actually started in December and
continued until sometime in late March. At that time, Fayiz became
concerned that the day-traders were taking advantage of the slight
increases in the share price that resulted from the buyback. This, if
you remember, resulted in more selloff and a reduction in the pps to
even lower level. Of course most of us who had money at the time,
took advantage of the low prices and bought more shares. NOT FAYIZ.
No, rather than taking advantage of the garage sale prices to finish
off the buyback and maybe even buy back more than planned, he decided
that he wasn't going to be used by the day-traders in this manner, so
he stopped the buyback all together. That kind of logic from a CEO
who has all of my money scares me. And of course none of that even
comes close to explaining why he dumped 3 billions shares onto the
market during the same time perios.
Fayiz then mentioned that he was researching the situation to
determine if there were any other ways to lower the O/S without a R/S.
He reaffirmed that we will never have another R/S. He also said that
the last one hurt him just like it hurt us. So he obviously has most
of his hopes resting on the pps of the common stock. The one thing
that he failed to mention, however, is that if he wants more shares,
all he has to do is vote to issue himself more shares as a part of his
compensation. Life is hard.
He then talked about the acquisition efforts. He said that the day
that any acquisition is finished, it will be announced in a PR.
Robert Laskowski then added that every such major change in the status
of the company has to be approved by the shareholders. He of course
failed to mention the minor detail that Fayiz controls 10 billion
votes and therefore any vote is a mere formality. And they
demonstrated clearly when they only sent notices of the shareholder
meeting to a couple of hundred people, that they are more than willing
to bend the rules. So I would not look too hard for any ballot to be
sent in the mail that would allow you to vote on the acquistition.
Laskowski clearly thinks that we are all a bunch of idiots.
Fayiz explained that the reason he doesn't tell us everything that is
going on is because everything has to be done in a certain sequence.
That of course explained everything.
He made a passing comment about overseas companies that are going to
be the manufacturing arm of the company, via contract. He also said
somehing about that being a revenue source. So it would appear that
they intend to sell franchises to overseas companies or collect
royalties from them.
One of the more interesting comments was regarding the question of why
they do not have patents. He said that everytime they change the size
or the thickness or purpose of a substrate for a customer, they
actually have to adjust the recipe and the process to accommodate the
changes. So it is impossible to state a single description that
covers them all.
That's all I have time for now. It covers all of my notes. As I
think of things that I heard but didn't jot down I will post it. I
tried to record the meeting, but they were not using a microphone, so
I couldn't pick up anything.
Overall, on a scale of 10, I give Fayiz a 4, the meeting a 3, the
quality of information a 7, Laskowski a -10. The was nothing about
that man that I liked or trust.
Others will have to fill in the gaps.
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