Here it is -- just the facts.
Greg and I (Jamie) have researched some of the primary concerns of the thread. Listed below are results that we believe are the answers. Marc McCurry also contributed with some very informative information on the CRIC deal. He will be following up on the deal with a much more in depth report in the very near future. All of these are are beliefs or opinions from information given us by various resources, including Genesis.
1. The short position on illegal shares was removed when the transfer agent was removed. This issue is now between the shorters of those shares and the brokerage firm involved.
2. The short position created by the covering of the illegal short
position was not covered. This does exist yet the size is unknown to us ( Greg and Jaime ). Bringing in of the stock to the office will allow a better understanding of the position and aid in the stopping it's progress. It should be noted that most every stock has some sort of short position and the main thing that will take care of this is the future news releases (CRIC closing, Big 6 announcement, Big 6 audit, 1st quarter numbers, Motorsports opening etc.) which should increase the stock price.
3. Transfer of the certs and the dividends will be done by genesis within two weeks assuming no complications. They have to acquire the materials on Monday and after they receive them the process will begin. The brokers usually say this takes 2-3 weeks. From the experience of others we can say it might be as many as three weeks. (Darci 3 weeks; Greg 3 weeks; Justaguy 3 weeks and waiting) This is the topic we thought that some of you might have a problem with. Once the cert transfer is ordered it cannot be stopped. If your certs were not transferred before the 17th then you may have to wait
this long for them. Genesis has a much better estimate of this and their numbers are better than ours. Meaning less time. If it's a concern, call your broker. They can tell you if they can work with you. Mine(Jaime) will. I have no certs that were ordered. Genesis assured us they will do everything that they can to speed up the distribution process.
4. A new transfer agent will be found ASAP. Appointments are setup with prospective agents. IMXS has a separate agent who is one of the
candidates. The transfer agent will be a major firm, but first the company needs to clean up the mess or problems from the other agent before a new agent will take it over. This cleanup will happen while they are processing the dividend and certs. The company has acquired some outside consulting services to aid in the processing. As we understand it, it is not uncommon for a company to act as its
own transfer agent on occasion. Some people might dispute this, but our sources have confirmed this.
5. Top priority has been given to the closing of the CRIC deal. As we know the Mexican CD is worth $99 million. The CD is only an asset to the company which is worth $17 million for a total of $116 million. It is in our opinion that this is a done deal. This was the main complaint for the past year. Did the CD exist? Well there it is. This made the company worth its estimates in this area as the stated in the balance sheet dated September 30 1996. This being true I (Jaime) see no reason not to believe that the rest of the numbers are correct. ( See Notes on page 97 of the Genesis Investors package, Note E.) Genesis's balance sheet for the same time period, (page 92), was $140,189,400.00 The CRIC deal is worth $$ 116 million at the least.
It should be noted that the CD only consists of $100 million, or $99
million, of the $140 million in assets. Thus, even though CRIC is being sold for $117 million, it is only on the books at $100 million. Thus, if the rest of the assets are proven to be credible, the "value" of GIFS escalates to $157 million.
This is not uncommon. Many companies have assets listed on the books
that are worth a lot more than book value. That is why we are required
to disclose the FMV and cost of Securities on financial statements. The one thing not required to be disclosed is a company's goodwill. Thus, CRIC may have had "book" assets of $100 mill, which were disclosed, but as we can see, the "value" is at $117 million, meaning the company has goodwill of about $17 million. Goodwill is generally defined as an intangible asset that has some form of quantifiable value. For example, the goodwill associated with Coca Cola or Microsoft is enormous. The reason CRIC was able to sell above BV is due to the goodwill involved -- meaning it is a profitable opeation. I am afraid some people on this thread are equating book value with fair market value. The two are not the same, though some accounting theorists believe that the financial statements should be disclosed at FMV and not cost.
Earlier in the thread, many figured if there was a $100 mill CD, then
why no interest income. This has been answered, but let me elaborate.
The CD in question is a special form of security interest in Mexico real estate - thus it is not an interest bearing CD. It's value changes with the underlying assets. This is no different than if a company in the U.S. bought land for $50 million. The value of the land would remain at $50 million on the books, even if it was worth $100 million.
6. All interest is on top of the $$$ 117 million. (I (Jaime) do this with rent houses. It works very well. I also have the ability to take out very large loans against them at very low interest rates.)
7. The principle question has always been the validity of the Mexican CD. We have received notification that it is real and worth $$$$99+ mil. This should stop all questions of the value of the company.
8. The first 2 PACECAR units are being built and financed by Motorsports Inc. Genesis will be providing consulting and PR work. Genesis will be responsible for building at least 12 more sites in the next year. Ground has been broken and site preparation has or is being completed after delivery of the tanks the structures take about 4-5 weeks to complete. A very tentative completion date is Memorial
Day. The new website may have some aerial pictures of the sites.
9. The lawsuit is unfounded. The company has documents and materials to prove this in court. Being that this is a court case a more detailed response could not be given to us.
10. The new websit should be up on April 21st. We should see a FAQ and
answer section, more pictures, maybe even a chat room. We will see what is completed when it is back up on Monday.
This information is all correct to the best of our ability and was
acquired from sources within the company and outside of the company. Most assured this information will be attacked from all sides, what we would prefer is a full analysis and questions asked back instead.
Thanks
Greg, Jaime and Marc
|
