Here's my last correspondence from David Fiume. David will respond to investor e-mails but don't expect anything speedy. His days are taken up maintaining live support. It took a month to get this reply.
I have pretty much given up hope of ever seeing anything come out of this outfit. They (and IBM) just haven't been able to sell anyone on the merits of their product. It's most amazing that they have been able to maintain a roof over the heads of their few remaining employees. The only success touted by management in the last three or four years is the cutting back of operations to meet zero demand. Not something to inspire confidence.
The good news is that their IVR system is still programmed to answer their phone. Have you heard something to the contrary?
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From: "David Fiume" <dfiume@telepanelsystems.com>
Subject: Re: A&P Stores Sold to Stop & Shop and Big Y
Date: Wed, 19 Mar 2003 10:48:50 -0500
Organization: Telepanel Systems Inc.
I have the following comments to your email.
1) TSX has suspended trading with 1 year to turn things around. - Yes, but the requirements we would have to meet to get on the TSX again are not attainable within the one year time frame. That is why we hinted that the TSX Ventures exchange would be the proper home for our trading. A few of the issues that caused a TSX suspension are also not allowing us to make certain requirements with the TSX Ventures Exchange. Obviously, we are not happy about this, but without closing a financing we do not meet the requirements. The real issue is trying to get this financing closed, which means meeting the requirements.
Despite the up turn in the financial markets the last two days,
[ My note ... One's really got to wonder what brought about the above comment !!! David also speaks about getting a deal which minimizes sharholder dilution. Very peculiar for an accountant type to highlight foregoing the dilution of zero worth ... nothing more than a token jesture to the folks they scr-wed with vision, intent. ]
this deal is having trouble closing, and we are trying our best to get it done and look at any and all alternatives. This last part is not new, we have monitored
all alternatives for a long time to with the goal to maximizing shareholder value, but the alternatives have been extremely limited. We are hopeful that we can close the financing and putting everything behind it, but this is a very tough market.
2) Casino order went to Eldat. Casino asked IBM to put up a few stores for free to try the technology, and IBM did not want to put up the money without concrete plans, hurdles, etc. Casino would not commit to anything, except taking the free store, and IBM, as did a few others, would not go along with this open ended trial. It has gone on for two years, and this is good news for the industry. My understanding is that Casino valued that Eldat is "European" based (well, Israel) and the geography played a part in their decision. Going forward, we need to be seen with more permanent establishments (through partners, etc.) in Europe, to provide comfort and support.
3) Mass. has cracked opened their door. I don't think this helps at all. Putting scanners in the aisles and allowing ESL or paper is not really a help, unless it turns into a disaster and people see what ESLs can do. People don't realize it, but there is a lot involved with getting ESLs in a state like CT, and these rules are what are needed to make people feel comfortable. They have state inspectors of ESLs, specifics in the programs to watch for in accuracies, a log of changes, the requirement to keep reports, etc. This is what is needed to get a comfort feeling from people on ESLs.
3) No news out of company ... As I mentioned above, it is all about financing right now. and yes . . .
4) Cash must be gone. (well almost, we have a little cash left and are looking for ways to stretch this and keep going to give us runway to get a deal done).
So what happens now? A summary of the options, if any, on the table today would be most appreciated. It does not have to be long. The options are to go down a few roads at a time, as we have for a while. Continue with the financing as the number one option. Keep pushing other alternatives, such as mergers, sales, etc. There are not a lot of alternatives, but there are a number of players, which we have looked at for a while. Some could not be approached before, but now, most bets are off.
As for the other message, we may lose a store or so, but not all the details are completed. We have just been contacted by one of the purchasers about the technology, and they are getting three stores, and a few competitors (to A&P) are simply buying the stores to close them down. Since some of these stores were in Mass, not all the stores had ESL systems.
S&S has everyone's technology as I understand it. They have approximately 20 TLS stores remaining, and I don't know how many ERS and NCR stores. They like ERS for there service, especially with an office in CT, and they continue to use these systems. S&S is a very demanding customer, and at times, we are not their favourite supplier, since we like to get paid for our service and hardware, which they do not like at times. They have our older technology, and have not been receptive to trying our newer stuff. The system is used the same way as always, since the look and the functionality are legislated. They have not asked for any modifications to functionality.
Let me know if there is anything else,
Regards,
Dave |
