Mark,
I am on another tirade. I know I probably shouldn't post this email I just sent SM but what the heck. I guess the worst thing he could do is not reply. Like that will be a change in his MO:)
If you get bored you can read the email to SM:)
Take care,
Kurt
Steve,
I was always taught to put the bottom line up front. The bottom line is that you should
resign immediately for the good of GMGC and due to your fiduciary duty to even the lowly
retail investors of the company.
The stock is apparently heading much lower once again. I can only surmise that this
decline is due to one of several reasons. The first possible scenario is that the IBM and/or
GM deal has gone sour or institutional investors now realize that both deals are a sham in
terms of recurring revenues for GMGC. A second possible scenario is that you have
requested to "tap' the ELOC and those famous preferred friends of yours are shorting the
hell out of the stock again. To think that under the ELOC agreement you gave the
preferreds up to 60 days advanced notice of your intention to tap into the ELOC. That is
more than plenty of time for the preferreds to destroy the price of the stock to get the most
favorable terms. Once again the retail investors are left clue less and the preferreds have
the inside track. A third possible scenario is that the preferreds have realized there is no
future for the company and they are quietly converting their shares and selling. A fourth
possible scenario is that the institutional investors or the large retail investors realize
GMGC's technology has absolutely no future in terms of recurring revenue. There are
other possibilities such as a lower price for an equity partner but since retail investors are
left in the dark then one can only guess as to why your company's stock is in a major
decline.
You are the CEO and thus are the leader of the company. Yet, you seemed to have failed
in even the simplest of leadership tasks. That task that I am speaking of is ownership of
the company. With the exception of options that you acquired approximately 3 years ago
at 10 cents a share you have failed to back up your words with action. In over two years
that I have owned GMGC stock I am not aware of even one GMGC share that you have
acquired as the CEO. It is obvious to me that even you have doubts that the company will
survive or else you would have purchased stock through options with your own hard earned
money (like us retail investors).
So much for telling the world that you think the company is very undervalued. Do you
really think the world buys that argument when they see these private financing deals with
the same preferreds who have controlled and destroyed the price of the stock over the last 2
years. Why did you go back to the preferreds when you publicly stated last summer that
you were looking at other means of financing? If GMGC is so undervalued then WHY
DON'T YOU EXERCISE ANY OF YOUR OPTIONS AND RISK YOUR OWN
MONEY?
There are a couple of investors that I know, combined with the number of shares that I
currently control, who lost $1 million in capitalization within a month after you announced
the Series H deal. I would like to ask you if you have lost that much out of your own
pocket due to GMGC's stock? I think the answer to that question is no. I believe you
have only contributed about $15,000 - $17,000 of your own money if you exercised those
options 3 years ago at 10 cents per share. That is pitiful as a CEO. You are no leader.
You may be a good visionary but it has become painfully apparent to me that you lack the
acumen necessary to successfully market the technology and run the company as a CEO.
You claim that GMGC's technology is bleeding edge, that GMGC is far ahead of any
company in terms of a voice user interface, that GMGC offers "the total solution" and you
always seem to claim in your press releases that a patent is pending on MagicTalk. What
good is bleeding edge technology (to include the "NOC") or a patent if you can't make a
dime on the technology? The answer to that question is that GMGC's technology is
apparently worthless or the management is worthless in marketing the technology. My
guess is that it is the latter. Which means you, Steve Markman, are responsible for this
failure as you are the CEO of the company.
What happened to your statement during the November conference call (we must execute,
execute, execute)? Well, you have failed in that endeavor as of today. It is almost nine
months later and you have yet to make a penny off of any recurring revenue from the
OnStar deal and needless to say you have earned nothing more than a memorandum of
understanding with IBM. In fact, in over two years that I have owned this stock you
haven't made a penny in recurring revenue from any deal (that I am aware). Nothing from
the 11 telcos. In fact, how much money did it cost GMGC for BellSouth to trial Portico?
You didn't even have the gonads to tell investors at the end of the second quarter that the
trials failed. I believe your press release stated something about the Portico trial being a
good learning lesson. Excuse my language but what a crock. The Qwest deal suckered
you and GMGC by stating they (Qwest) would test or trial Portico but in return GMGC
would owe Qwest $13.5 million for utilizing Qwest's communication's system. That is my
understanding of the Qwest deal although I could be wrong about Qwest trialing Portico.
Anyway, what idiot was responsible for that deal? GMGC's other deals like Intuit, Excite,
and Juno have produced nothing whatsoever in terms of recurring revenue. What type of
business do you think you operate? A charitable institution?
I don't buy your argument that it takes a long time to make these deals. That is an excuse
pure and simple. Look at Nuance and SpeechWorks. They are signing deals left and
right. How come you haven't signed any of these smaller deals with companies that are
ALLEGEDLY knocking down your doors. Hell, even a $2-3 million dollar deal beats the
hell out of any deal you have made to date (at least this would have a $ sign attached to the
deal). In case you don't know, Nuance's market capitalization is now approximately $5.2
BILLION and SpeechWorks market capitalization is now approximately $2.7 BILLION.
GMGC's market capitalization is now approximately $440 MILLION and that is if you
include 100 millions shares since for all intents and purposes that is how many shares of
GMGC that are spoken for by different entities. THAT IS PITIFUL. The market is telling
you something Steve.
You, Steve Markman, are running the company like a ship without an oar or a rudder.
You have absolutely no sense of direction or strategy for GMGC. You have changed
courses like a person who has absolutely no business sense whatsoever. I don't buy the
idea that we are treading in new waters and have no tail lights to follow. Once again, look
at Nuance and Speechworks. These two companies just went public in the last six months
(Speechworks in the last few weeks). They seem to be doing fine without any "tail
lights." You have claimed B2C, B2B, ASP, and I believe your latest gimmick is call
centers. My question to you, "What will be the flavor of the month for September?"
I would like to end with saying that you have lost the trust of many investors, you seem to
be incapable of running a profitable company (not to mention a company that can produce
any recurring revenue whatsoever), and you should resign effective immediately.
Sincerely,
Kurt Fitz-Randolph
PS Feel free to contact me by email or by phone |
