Now here's the really important information that needs to be digested
Posted by: Stock H.O.G.
In reply to: None Date:12/5/2006 12:40:33 AM
Post #of 203514
From Airys & Stock H.O.G.:
We believe this to be a positive, in that, we received information and were welcomed by everyone. The following is what we saw and what we heard. Make your own decisions and develop your own opinions. This could all be real or this could all be the best scam ever, we’re not really sure. We went, we saw, we heard, we’re reporting back to you.
We met up in the Detroit airport and rented a Jeep Cherokee and drove to the Canadian border. After they searched our car, our bags, and asked us what our intentions were, they finally let us through. When we told them we met on the internet, I believe they looked at us a bit strangely! We stayed at the Windsor Casino/Hotel, since its right in Windsor and right over the Canadian border. We got into the hotel room and tried to formulate a plan. We really weren’t sure of which direction we should take and who we should visit or not visit.
The first thing we did was call Tracey from Kore at the number that was provided. It turned out to be her home number, so I apologized for bothering her at home. I told her who I was and said we were trying to gather information/facts about Sulja Bros. She asked how I received her number and was a bit shocked that I called. She said that I should talk to Sulja Bros and could talk to their IR department. I told her they don’t really have an “IR” department. She said she had no comment on Sulja Bros. I told her thanks and have a good day. We didn’t really expect much from this call.
Gary Rennie and I did trade a couple of voicemails, but we never spoke or met in person. We were still on the fence as to whether or not we should be talking to the WS anyway.
We called mrdrammar, as he was eager to meet up with us. He met us at the hotel and had dinner with us. He provided us his opinion, which is clearly stated on IHUB. We were not really sure what to expect from him and actually thought he might have been “sent” to meet with us and determine our true intentions. He ended up being a valuable asset and helped us locate all of the places. He was even willing to drive us, but we took him in our car. We didn’t want to end up at the bottom of Lake Erie.
We determined our strategy and knew we had little time to execute everything we wanted to accomplish. Our plan: find and talk to Steve Sulja or John Sulja, visit and take pictures of each location and talk to everyone there, as get to a “feel” for what was going on. We also talked about gathering tax records and the like from the courthouse, but knew we didn’t have time for that and we didn’t think we would get much value there anyway.
We woke up and were out the door by 7:30 a.m. with no breakfast and off to Harrow. When we got there, Dave, who is the General Manager of both Sulja locations was there and gave us a tour of place. There were trucks, people, supplies, etc. It looked like a solid business, at this location. After the tour, it was time to get down to business. We asked Dave what was really going on with everything and we needed to meet with Steve. He said Steve was with a supplier in London, ON. We asked where Petar was. He called Petar on his cell phone, told Petar we were there and then handed the phone to Stock H.O.G. H.O.G advised why we were there and asked to meet with him. He accepted and said he would call HOGs cell about 12:30 and meet us about 1:00 at the Windsor Casino/Hotel in the lobby. We then were able to meet Christine at the front desk and Leslie, who is on the BOD and manages various aspects of accounting for Sulja’s. Some of the key points from our conversations with them:
1) Everyone there was very nice and helpful. They are real people, with real families and seemed honest and sincere.
2) The WS sent SAMs a letter stating they would retract their article if they could prove them otherwise. (HOG has the letter)
3) They believe the Windsor Star will be sorry for what they have been publishing.
4) Both Leslie and Dave received death threats and were very scared. They called the police and the police are now investigating those who called. It’s highly recommended that this never happen again.
5) They sold all kinds of materials at this location, both building and decorative.
6) Due to so many calls there, they believe they are losing non-commercial business, which will certainly not help anyone.
7) A couple of shareholders have been up there to visit over the last 6 months or so. They basically wanted to ensure there really were operations there.
8) The lawyers advised them to “not talk” for now.
9) The lawyers, Steve, etc have our questions.
10) Leslie never saw any “audited” financials, as previously reported by someone.
11) Leslie has worked there for about 6 years.
12) Dave has worked there since September and has a solid background in the steel industry.
13) Dave again advised that he was interested in buying shares, but not until after the AFs came out, as he didn’t want to be considered an insider. He does own other stocks and is aware of the market. He’s read the IHUB board a couple of times and couldn’t believe how bad it was.
14) Dave was willing to take pictures with us and let us take as many pictures as we wanted all around the place.
15) Leslie was out of the office a lot last week because she was meeting with the lawyers. I understand they have four lawyers (1 in Windsor, 1 in Texas, 1 in Toronto and Khan).
16) They knew we were coming and someone called and said, “The HOG is on his way”. That funny as hell! They asked who the HOG was, so we told them our IHUB names. We all laughed, and then traveled over to SAMs.
At SAMs, we were greeted by a man named Ron (can’t remember his last name), but he was the manager of that location. He showed us around and we took more pictures. We found out some very interesting information from Ron and they are as follows:
1) Sulja’s did buy SAMs and everyone there is on the Sulja payroll (Dave told us this too).
2) They did not buy the land or the building, as they are leased. Mario’s father owns the land and building, not Serge, as the WS reported. An offer to buy a total of 62 acres was placed, but not finalized. The purchase of the business, trucks, and materials was finalized. I understand the land across the street sold for about 20k/acre. Must be a good location.
3) They bought them because there were competing with each other and it was better to buy them out, instead of competing with them.
4) No stock was provided in this deal, it was all cash.
5) Revenues may be down to about 4M this coming year, as the building market is starting to change. However, they are starting to do work with a big builder, Royal Builders, in London, ON, which will probably boost sales again.
6) There is another business right next to SAMs on the same property, called SBT. We didn’t get much info on this, but it’s something that Mario runs and relates somehow to building.
7) Ron said he has been friends with Petar for about 10 years and he’s a good person.
8)Ron said he believes the stock is undervalued at this point and may also buy some shares after the AFs.
9) He said he truly believes in the M.E. deals, as Petar would get all excited and tell him he landed a big deal, etc. He said he’s seen contract paperwork, but not all of the details within.
We then went to the Windsor Sulja location, after HOG stopped for 2 minutes and bought a Harley long-sleeve T-shirt at the Windsor Harley dealer. This Sulja location was closed and appeared to be a storefront. We did not confirm that the new storefront was opened. We’ll have to inquire more about this location. It wasn’t impressive.
After that, we decided to locate and visit S. Khan. We went into his office and asked the receptionist for him. He was with a client, but came out after about 5 minutes. We introduced ourselves and asked if he could tell us anything regarding Sulja Bros. He was very nice, but said he couldn’t say anything. He did say he was basically the internal lawyer for Sulja Bros. HOG asked him if he could explain why he was the CEO for only one day. He again said he cannot and that we should talk to Sulja’s directly. We told him we were meeting with Petar in about 30 minutes.
We quickly drove back to the Windsor Hotel/Casino and waited in the lobby for Petar’s call. He called at 12:30 and said he would be there soon. He showed up, we all introduced ourselves, and then he asked if we wanted to go into the restaurant. The picture in the Windsor Star made him look very bad, as he looked fine to us. He’s not mister suit and tie guy, but was dressed and looked fine. We sat down and the questions began. Below is what we were told:
1) Wessal is a real company and they are registered in Saudi Arabia. However, Wessal/Red Sea Group is no longer a part of the equation. They sold their shares, but did help them to gain connections in the Middle East. This actually gives them more control, as they don’t have to answer to Wessal.
2) Sulja Bros hired Kore to manage and help to grow them. The Sulja’s are good friends of Petar’s and he will do everything he can to help them.
3) Petar said that 100% guaranteed the AFs will come out. He said he was promised things, he promised us, and then things fell through. He said he could not post the AFs, because they were not 100% accurate. PWC was involved, but not KPMG. The PR should have said “or” not “and”. PWC will not be doing the final review of the latest financials. Econometrics was also let go, as they were not doing good work. They will be using a reputable firm in Toronto going forward and also mentioned E&Y as a possible final reviewer.
3) The stock does have all of the assets included. The assets included from overseas were strictly contracts. The default SPAC is no longer used. He said we could check with the Ontario Securities Commissions to confirm.
4) He stated that every single PR is true. He did say that he believed the PR regarding the revenues was not 100% accurate, which has added to the confusion in the AFs.
5) They do still plan to get off the pinks.
6) They do not feel there is currently a naked short position.
7) They have been pulling weekly NOBOs and see what some of the large shareholders are doing, which is not legal (i.e. 1% w/o registering with SEC)
8) CCM Midwest merger is off.
9) 190M restricted shares remain. There are a portion of other shares held by the corporation in Treasury. Sulja’s do not own shares. They were bought-out by the corporation.
10) No dividend will be declared, as we’re trying to grow and use the income to do that.
11) He’s not sure why the TA is gagged, but will look into this.
12) Steve Sulja is starting to do some of the Middle East work and is setting up a corporation in Lebanon.
13) We paid ~500k for SAMs plus some deal regarding upcoming purchases. Need more detail here.
14) Any and all Sulja corporations will be included in the AFs.
15) They know they need to hire an IR firm.
16) When they broker deals, only the commission hits the books and is taxed. If they didn’t do this, the taxes would be massive.
17) Sulja Bros does not owe 1.5M for the default mortgage with Loftwerks. They did not take on any of the liabilities. It is DA’s responsibility.
18) He said there are many, many charities that he donates to around town.
19) He’s not happy at all about the WS articles and will do something about it. He expects them to continue their articles and Sulja’s will be refuting all of them shortly.
20) It costs about 38k to setup a booth at the Rebuild Lebanon exhibit.
21) He said he was investigated by the RCMP, but everything was fine and he has not been contacted by anyone else. He said if there was a problem, the stock would have been halted already.
At this point, we ran out of time and had to leave. Our heads are spinning from all of this information. Also, I believe we'll see another WS article in the morning. Like I said, I believe this will be refuted by Sulja tomorrow.
Please let us know your thoughts. We hope all of this helps!!
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