Notes from conversation with Mr. Ulrich Gottschling (President of Sound Source Interactive):
1. Next shareholder's meeting is in November
2. He thought their IPO was premature.
At IPO, they wanted to raise $10 mil
a). $2 mil for capital
b). $6 mil to repay debt
c). $2 mil - cost of IPO
3. They are in the unenviable position of having a stock that has fallen to $1. He speculates that the stock is NOT going to miraculously go to $5.60 in the next two months (for the sake of the warrants).
4. They are trying to come up with another way of dealing with the warrants without diluting existing shares.
5. They have 2 new market makers: Webb Bush and Sutro (spelling?), reputable market makers.
6. In their discussions with institutional investors, these investors are asking them to do this, and this, and this (capital structure is in line with their organization's goals & direction, be profitable, long-term licensing agreements, the situation with the warrants, etc.)- and THEN they'll come back and take a hard look.
7. Robert Burke (added as a director last Feb) has been helpful with these negotiations. Ulrich said that at their board meetings, they are working on about 7-8 different issues, an important one of which is the warrants. He feels THAT is what's holding down the stock price right now. Shareholders will vote on how the warrant situation is handled. He thought that a solution would be forthcoming within the next 6 months.
7. End of their fiscal year is in 6 weeks.
8. He didn't comment directly on my remarks about the sudden spikes in volume concurrent with a more dramatic percentage increase in share price. He just said he thought the market maker situation had been improved.
9. Please hang in there with us!, he said.
Well, Dale - this is what I managed to eke out of him. Wish I were more clever at asking the right questions - but these people are understandably careful not to reveal insider information.
Hope this helps. |
