Ed Gallagher called me... Here is the gist of the conversation...
while it's still fresh in my mind and I can still understand my notes. He had mentioned a PR and I have seen none... First of all, let me state that I don't take a NEGATIVE stance on a Company lightly, as my style of investing is to be a Long stockholder... However, I believe in protecting new investors, even if it's detrimental to my immediate interests... The Companies I have factually spoken against (different from bashing) were DCHT ($2.16 down to 41 cents), FWEB ($27.75 down to $6.37) and TNRG ($1.05 down to 9 cents)...
First of all, Ed is a convincing fellow and an artful dodger when he doesn't want to answer a direct question... Now, remember that most successful con-men and I am not saying he is one, are very good at convincing people...
1) Q: I understand the need to split the 2 Businesses, as there are good reasons to do so... But why DHIE, why give away $20 Millions, why not a shell for $300K and 95% of shares to EVCM, instead of 50%?...
A: Ed went along with my $40 Million valuation for the Telecom Interest but prefers to stick with his DHIE deal rather than the more logical (for shareholders) clean shell.
2) Q: Do you own or control any shares in DHIE?
A: Whatever we own will be "pooled", meaning the shares will become restricted stock...
3) Q: Explain why you, as President, had to give back 150K shares of Global Cogenix and assume some $280,000 worth of Liabilities?...
A: It wasn't me, it was Erwin Liem, the CFO...
4) Q: Won't the 50% interest of EVCM in DHIE be further diluted when you issue shares to secure your $5 Millions financing?...
A: Yes, it will, but I don't know by how much...
5) Q: IMO, you are stripping Telecom assets from EVCM to serve your own interests in DHIE. You claimed and I bought EVCM for that reason, that there would be $4 Millions net earnings in the first year of the Telco operation, accruing to EVCM...
A: The Telco assets I am transferring into DHIE don't belong to EVCM, so there is no stripping...
6) CONCLUSION: Nothing that Ed has said changes my opinion that he is stripping assets that he said were going to create a Revenue for EVCM to vest them in DHIE, which IMO, he partly or fully controls... As a result, I shall continue my efforts to get SEC to intervene and if the deal goes through shall make every efforts to bring about a Class Action Lawsuit... I do NOT TRUST the MAN!!
Regards, F. Goelo + + +
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