Gentlemen,
I would like to introduce The Genesis Daily News. This report will be released by 8:00 EST Monday through Friday and will contain the all the important news and associated posts that are found within the thread. This service is in no way part of Genesis or the SI. The posts will be duplicated here in full and none will be edited for content. Along with this you will find the direct links to all the posts found within the letter. What you will not find here is bashing of any kind or any of the casual conversations of the daily posters or any type of editorial. This will provide us with several benefits. First we will have a stable reference which is easy to read and follow. Second, time will be saved by us and the potential investors who read this thread. Third, Unnecessary bashing of the stock will be effectively removed. Do not misunderstand this benefit, ALL negative posts of substance will be included without exception.
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NOTE***One post which contains bashing is included in the report. This is final notice. Bashing posts will be left out. If you want your voice heard, keep it clean.
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To: greg martz (4516 )
From: Marc T. McCurry Apr 20 1997 2:43AM EST
Reply #4518 of 4607
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
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To: Marc T. McCurry (4518 )
From: craig crawford Apr 20 1997 6:19AM EST
Reply #4521 of 4607
Hmmmm. Very interesting. I must have been composing my long reply while you were posting. It's too bad I didn't wait so I could have consolidated my thoughts.
I want to start off by saying that what I am going to post below has nothing to do with the people who reported what they found. I'm sure they worked very hard to collect all this info. It is the info that they uncovered with which I have a problem. Let's get started...
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. >>
This is just a nice way of saying that THERE IS NO BIG SHORT SQUEEZE that is going to happen. The several people that promised this to the thread were either lying or dead wrong. You decide.
2)<< 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. >>
Essentially they are saying that you are going to have to wait again. More broken promises from individuals who promised the thread their dividends on more than 1 occasion. "you will have your dividends in 10 days", "The dividends should be sent out Monday" etc.
3) << 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. >>
I already answered this in my previous post. Just because the CD is carried on the books for $100 million doesn't mean you can go out and get $100 million cash for it right now. I also already discussed why the rest of CRIC being worth only $17 million (actually I used $15 million just like MTM) isn't so great. I think the way the CRIC sale was structured proves that they couldn't get $100 million cash for this asset, hence the payment plan and low selling price.
4)<< 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. >>
Obviously it's value didn't change for the better. It was just given a value of $99.25 million, so it is less than the $100 million stated on the books. If this was a REAL CERTIFICATE OF DEPOSIT it would have been generating millions of dollars for GIFS each year. Instead it decreased by $750,000 and it lost part of it's value due to inflation. It should have been bringing in income to GIFS, not declining in value. Like I said, not like cash is it? GIFS had $100 million tied up doing them absolutely nothing.
5) Nothing interesting happening with the NASCAR deal yet. No surprise.
6)<<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. >>
SO WHAT!!!! This misses the whole point! It's not for GIFS to decide that the lawsuit has no foundation and therefore should be hidden from investors. Current and prospective investors should have the right to know this ahead of making their purchase!!! Don't you think this should weigh in on someone's decision to invest in a company? Wouldn't you want to know if a company who's stock you were about to purchase had a claim filed against them for more than their market value? Half their so-called asset base? Credible companies release information like this immediately to the public. We had to hear it from someone on this thread. I think some of you owe Julia Anthony A BIG APOLOGY! She presented relevant information to the thread long before I heard anything from GIFS. Some of you jumped down her throat and asked her to put up. She did. Then you attacked her some more!
This just shows a continuous pattern of deception and stench surrounding this SCAM OF A COMPANY. GIFS will do everything possible to get every little piece of good news out about their company, but will conveniently neglect to release pertinent information to investors when it's not so rosy. If I were you I would feel betrayed by GIFS. ALL THE WARNING SIGNS ARE STARTING TO SURFACE. I won't feel the least bit sorry for any of you if you lose EVERY GODDAMN PENNY THAT YOU OWN on this stock. You GIFSters continue to ignore things about this company that stare you right in the face. I even hear idiotic comments like "even if they lose the lawsuit it's no big deal. It's only minor dillution." Who gives a flying F*** about dilution? Wouldn't you be more concerned that the court sanctioned GIFS and their credibility was in question?
Well GIFSters, I don't know what the three musketeers thought was so good about the things they talked about in their post. It looks like the CEO might get a chance to revisit his buddies back in the joint the way this company is headed. I am continually amazed that GIFS holders can hear the worst information about their company yet put a positive spin on it.
WAKE UP AND SMELL THE LAWSUIT!!!!!
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To: Jeff Silverman (4510 )
From: Jaime J. Pulaski Apr 20 1997 10:58AM EST
Reply #4527 of 4607
Jeff, I can see you have been a very busy man!!
SHORTY'S BLACK FRIDAY ...
That said, we will get right down to the newest juicy and still bizarre tidbits in the multi-million dollar high-stakes battle between GIFS management and GIFS shorters. Specifically this past Friday, as the 'shorters' obviously could not find collaborators among the market-makers (the tape showed of approximately 35,000 trades, 33,000 were at the offer, and the shorts could not muster even a single hit throughout the afternoon when volume had diminished and the bid-ask was extremely vulnerable with only one market-maker at the bid (FRAN at 1.6875) and one (HRZG at 1.75) at the ask. GIFS holders must have been estatic and the shorts horrified to find that after the disclosures that they had been trying to use for 'extortion' were fully made, the stock price strongly advanced, leaving them with no whisper threats and a gross miscalculation as to the Street's anticipated reactions.
With no confederates among market-makers, no support in the Street for their short whisper campaign and no filing of lawsuits as had been 'threatened' and obvious rebuffs by the BDO auditors who authorized an advance peek at their findings, friends of the 'shorts' contacted Jeff Silverman, a contractor and major holder, who in December had gained prominence as 'Mr. Smart Investor' when he contacted Waaco and announced he was 'trying to buy the float'. The Friday contact was made by Todd Pauley, the Wisconsin>contractor who it was recently revealed was quoting from documents which came from the previously-reported break-in of the CEO's automobile, a break-in supported by a police report dated Jan. 14 and made available to
Waaco and to the GIFS 'SAC'.
It appears Mr. Pauley kept Mr. Silverman on the phone for more than an hour, attempting to undermine his confidence in the company, quoting from internal and partial company documents which were 'questionably' obtained. This alone is not bizarre. This moderator received a similar call from Mr. Pauley a few days ago, and it was after this phone conversation that Mr. Pauley failed to provide any documentation that he had EVER held shares in GIFS, despite his more spectacular representations of major buys back in December, supporting Mr. Silverman's assertions. This is thought to be the
first time the two had spoken.
'MR. SMART IMPOSTER'
What was bizarre about the conversation, however, was that there was a>second person on the call, whom Mr. Pauley introduced to Mr. Silverman as his attorney, Utice Payne, Jr., Esq., of Reinhardt, Boerner, Van Deurne, Norris & Rieselbach, S.C., of Milwaukee, a former Wisconsin corporation commissioner whom Mr. Pauley misrepresented to Waaco as having been an SEC Commissioner, and whom the attorney for GIFS, Robert C. Rosen, Esq., of Rosen & Associates, Los Angeles, who IS a former SEC employee (12 years), also alleged was misrepresenting himself.
Later in the day, as Mr. Payne actually did speak with Mr. Rosen, Mr. Payne stated he was startled to learn that he had purportedly participated in a conversation Friday with Mr. Silverman. Mr. Rosen seized the moment and conferenced in Mr. Silverman, who supported Mr. Payne's denial, saying that the voice of Mr. Payne was not the same voice belonging to the person who represented himself to be Mr. Payne in the earlier conversation Mr. Silverman had with Mr. Pauley and 'Mr. Smart Imposter', and whom Mr. Pauley introduced as his attorney, Mr. Payne. To represent an attorney, who is an officer of the court, is thought to be a criminal offense.
We have a copy of the letters memorializing these events:
April 17, 1997
Mr. Utice Payne, Jr.
Reinhart, Boenerner, Van Deurne, Norris & Riselbach, S.C.
1000 North Water Street, P.O. Box 92900
Milwaukee, Wisconson 63202-0900
Dear Mr. Payne:
'I have not received responses to my two letters to you of April 4, 1997 and April 7, 1997. One would think that if your client Tod Poley had a legitimate claim he would provide evidence to support it -- as you
represented he would. I can only assume at this time that your client has no claim whatsoever and is merely trying to make trouble.
'To compound the matter, I received a very disturbing call this morning from a shareholder of Genesis, Jeff Silverman, who informed me he spoke with both you and your client, Mr. Poley, earlier today. Mr. Silverman stated that you and Mr. Poley had informed him that the two of you have damaging information that you intend to disseminate publicly. According to Mr. Silverman, you intend to disclose false and misleading information regarding Genesis' ownership rights in Miller Mountain Mine, as well as false and misleading information regarding American Lift.
'I do not know your source of information. I do, however, know that you have an opportunity to verify the veracity of the information -- bot for some unknown reason, you choose not to. As I informed you in my letter of April 7, 1997, your entire approach is baffling and suspicious. This latest information, if true, appears to verify that thought.
'With respect to American Lift, somehow you and/or your client illegally obtained a copy of a February 11, 1997 proprietary and confidential internal company correspondence. It now appears that, not only have you illegally obtained this letter, but you have in your posession other illegally obtained confidential documents. This is a demand that you and your client disclose to us how you obtained those documents and immediately return to this office all originals and copies of those documents.
'If the statements of Mr. Silverman are correct, you and your client should be advised that if you continue on this path of attempting to destroy Genesis and shareholder value that you both will be held accountable for your actions.
'Lastly, it has come to my attention that you are representing yourself as a former SEC Commissioner. Having spent 12 years at the SEC myself, I know you have never been a Commissioner of the SEC.'
Very truly yours,
Robert C. Rosen
Rosen & Associates
First Interstate World Tower
631 West Fifth Street, Suite 5800
Los Angeles, CA 90071
=== Obviously, Mr. Payne was shocked to learn that he was 'accused' of having been a part of a conversation between Mr. Pauley and Mr. Silverman, and in a subsequent phone call with Mr. Rosen, was adamant that no such conversation took place. Mr. Rosen memorialized that conversation in a follow-up letter to Mr. Payne, which is but yet another bizarre chapter.
April 17, 1997
Mr. Utice Payne, Jr.
Reinhart, Boenerner, Van Deurne, Norris & Riselbach, S.C.
1000 North Water Street, P.O. Box 92900
Milwaukee, Wisconson 63202-0900
Dear Mr. Payne:
'This will memorialize the telephone conference we had this afternoon. As I informed you, Jeff Silverman informed me that he spoke earlier in the day, for 1 to 1 and 1/2 hours, with your client Tod Poley and you. During our conversation, you and I then nferenced in Mr. Silverman who stated, atfter speaking to you, that it was not your voice who was speaking to him along with Mr. Poley earlier in the day.
'If Mr. Silverman is correct, it appears that your client will go to any lengths to damage Genesis, including having someone impersonate his own counsel.
'I await your response after you have spoken to your client.'
Thank you.
Very truly yours,
Robert C. Rosen
Rosen & Associates
First Interstate World Tower
631 West Fifth Street, Suite 5800
Los Angeles, CA 90071
=== WOW! And to imagine Mr. Pauley 'lurked' on our WKF, our WSE and our PET for five months! It is also obvious from these turns of events that the 'purported impending lawsuit' by Mr. Pauley is hogwash, as Waaco would say. He is not only misrepresenting what Mr. Payne is doing on his behalf but Waaco would be mighty surprised to learn that Mr. Payne will remain Mr. Pauley's attorney. No self-respecting officer of the court would allow himself to be involved in a fraudulent imposter scenario. We are certainly awaiting this outcome.
Meanwhile, for GIFS, Friday's activity and Street response seems to mean its executives can get on with the business of running the company and closing the sale of CRIC now that the sideshow has become strictly a sideshow ... in fact, Waaco says it's now more of a 'Street performance' since no one is any longer paying the price of admission . That's a bittersweet development, since we have become kinda caught up in Shorty's day-to-day corporate espionage and intrigue. Even Waaco hisself just can't make stuff like this up .
It's also become evident that the efforts of some of those whose whispers had depressed the price from its 3-1/4 high have been or bordered on the illegal, laying open those individuals themselves to possible shareholder lawsuits from anyone damaged by this price slide. Let us know if anyone in the SAC or elsewhere contemplates a class action suit aimed at Shorty and his confederates.
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To: greg martz (4547 )
From: michael d kugler Apr 20 1997 1:35PM EST
Reply #4549 of 4607
Greg,
I'm not sure what Mr. Rosen or you are saying. I can tell you that Mr. Payne was a Marquette grad and a basketball player for them. He was the Securities Commissioner for the State of Wisconsin, and now spends his time in private law practice. He currently spends a lot of time on the Milwaukee baseball stadium project.
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To: Jaime J. Pulaski (4550 )
From: Lee Solomon Apr 20 1997 5:41PM EST
Reply #4554 of 4607
Jaime, I believe you are correct. There are people lurking on this thread that have the answers to my questions about the lawsuit. They know the details about the lawsuit but are waiting for a more appropriate time to post the details (more appropriate time for them). Why don't we jump the gun and go ahead and post whatever information we can find about the lawsuit so that the word is already on the street. If this is done then they can not spread rumors or twist the true facts to suit their purpose. Unfortunately I do not have access to look up the information or I would do it myself.
If in fact this lawsuit was filed by individuals holding bogus certificates then we should all be happy for the lawsuit. A judge will finally make a decission on this issue and we can move on. But I do not know any details on who has filed the suit.
Can anyone help?
Oh, and one other thing, until we know the details of the lawsuit everyone keep in mind that anyone can sue anyone for anything. Remember this is America where you have a constitutional right to sue. (This was meant for you 007 because I doubt you can comprehend how sue happy Americans are. You brits have a much more sane view of lawsuits. Hopefully we can adopt some of your laws in this area.) So when we find out who is sueing GIFS we the shareholders can sue them. :) First we will get Johnny Cochren to defend GIFS. Even if they are guilty they will get off. Then we will get F. Lee Baily to counter sue whoever is sueing GIFS and we will get 75 million. :) On second thought we should get whoever represented that lady who dumped coffee in her on lap and then sued McDonald's. She won!
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To: Joel Oseran (4556 )
From: Marc T. McCurry Apr 20 1997 7:49PM EST
Reply #4557 of 4607
I figured I would throw my two cents into the latest saga regarding Mr. Pauley contacting Silverman. I find this absolutely amazing. I just have one question --how in the world did Mr. Pauley all of a sudden decide to "befriend" silverman and let him know his investment was in "danger." I find it amazing that everything is questioned, except the CRIC sale. Hmmm. Perhaps because Bdo verified it. If Miller Mountain is not there, let the auditors determine it and let Jeff hear it from GIFS themselves. And American Lift -- a fruad. No offense to American Lift, but if it weren't there, I could care less -- I care about the CD and the CRIC sale right now. For crying out loud, the entire (American Lift) company is immaterial and I bet the auditors don't even look at it.
I've never heard of someone calling the primary shareholder of a company and trying to convince him his investment is "bad." It just doesn't make sense to me. After Silverman Blasted the guy, you would think the guy would be all grins if GIFS blew up and Silverman lost everything along with the rest of us. Doesn't make sense to me why he wants to make Silverman aware of impending danger and "help" Silverman cut his loss. It is always interesting. Now, if Craig Calls Silverman and those two decide to form a company to mount a takeover, maybe we will know something is up???? Kidding, of course. Based on these new revalations, I would like to prepare everyone for the simple fact that some more unsubstantiated news may hit in the future. There may be some small minute fact to some of the news but I would suspect people will try to glamorize whatever may come out. I don't know anything that anyone else out there knows, but I do know if you look hard enough, you can find some form of dirty anywhere.
On a closing note, since I have had time to think about it, I have one more point. The CEO was incarcerated. FAct. However, the fact he got out seven years ago tells me that it has been public record for SEVEN YEARS. Does anyone other than me find it ironic this gem of story was disclosed the exact same day as the lawsuit was mentioned. The ceo's past indiscretions could have been mentioned anytime, and I mean anytime. I find it ironic they were mentioned on the exact same day everything seemed to blow up.
The events of the last week remind me of a political contest. People digging up dirt and saving it as amunition. Then, when the time is right, so as to help their positions, boom -- here it comes. It's no different.
Well - I need to get back to work but hope to do an addendum to my congress analysis later tonight.
MTM
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