PRIM.0017.Alert.Read shareholder letter new,posted on the web site this evening.Could be a play tomorrow.Watching tomorrow.
primeholdings.com
We have several large contracts ready to finalize in the coming weeks. With Busboy’s new pricing structure we expect these contracts to bring exceptional revenues into Prime.
June 22, 2004
Dear Valued Shareholders,
As the end of second quarter of 2004 approaches I want to update you with our recent events and developments. April and May tested our commitment to make Prime a revenue generating, efficient capital growth company. In May we acquired the necessary network capacity to keep up with Target’s growth pattern and maintained BusBoy’s scheduled commercial launching at two upcoming industry trade shows. These last few months have been a graduate class in growth management and leadership.
With Target, the capital investment required to purchase state-of-the-art network equipment further establishes Prime’s commitment to sustainable organic growth. We now have our own network. In April we were very close to capacity with current bandwidth requirements. In May, Target managed to squeeze an additional 25% in revenues and bandwidth out of its existing network. Acquiring and developing our own network (facilities based) is paramount to keeping up with growth. This is now done. As the network settles into place we will see increased revenues later this summer.
Many of you have asked questions about Prime’s ownership in Target as well as our continuing involvement (if any) with Briza. I want to answer these questions now.
Prime’s capital investment into Target has been significant. It has stretched us to the limits. Many of you have asked what Prime’s equity ownership in Target is and/or will be. As I indicated in the past, our aggregate equity will be determined by our ultimate total investment. Right now Prime has the right to acquire up to 60% of Target’s equity ownership. Right now our investment has accrued about 51% of Target’s equity. As Target grows, Prime may be able to acquire a slightly larger part of its equity ownership by providing growth capital. Please be aware that this ownership percentage could change to further benefit Prime by assisting Target in acquiring stakes in other telecom entities.
As for Briza, I have been speaking with Briza’s CEO and discussing a proposal made by Ashlin Capital’s CEO that would allow Prime to reconsider its involvement with Briza. You may recall that I was concerned that Briza’s capital requirements might have outstripped Prime’s then available resources. But an Ashlin Capital financial analysis of Briza that I initiated has convinced me that there can be a very significant revenue upside with Briza. Additionally, to protect Prime’s capital limitations, I decided to have Briza raise its own growth capital by merging Briza into our TimeMarker subsidiary, and spinning it off as its own public entity. The new TimeMarker-Briza company will then raise its own private/public capital to complete the deployment of the Briza network in Brazil. Because of his continued, unpaid support of Prime, I have asked the CEO of Ashlin Capital to serve as the Interim Chief Financial Officer of the new TimeMarker-Briza entity to facilitate the capital raising and the deployment of the Brazilian network. Those of you that were shareholders when we approved the TimeMarker spin off last year will receive a stock dividend. I want to do the same for newer shareholders also. I am not yet sure what form this will take, but I will propose a formula shortly. This, I believe, is an excellent solution that allows all of Prime’s shareholders to benefit from the revenue possibilities of Briza.
As for Busboy, things are progressing quite well. We are attending a trade show this week. For those shareholders interested in attending the Orlando Show in October we have a limited amount of passes that we could provide you on a first come first serve basis. We have several large contracts ready to finalize in the coming weeks. With Busboy’s new pricing structure we expect these contracts to bring exceptional revenues into Prime.
As always, I appreciate your support and confidence. These last few weeks have been taxing; but we have some exceptional opportunities in front of us and we intend to exploit these for the benefit of Prime and all of you, its shareholders.
Kindest regard,
THOMAS ALIPRANDI |
