Here's some points to ponder from the 10-k:
1. Page 4. Selling off the equipment orginally setup for pick resulted in a loss on equpment of $370,000 plus some undetermined amount over $186,000 for breaking the lease (p31). This probably needs to be placed on old management although I don't feel existing management did very good getting only 10-12% out of the resold equipment.
2. Regarding Nehaus and Morley options, page 4 states "The Company has not calculated the amount of compensation expense related to this transaction as the fair value of the net assets being transferred to the new entity has not been determined." I have a problem with management giving them options for which they haven't determined their value. How does one determine if the compensation is reasonable???
3. Also page 4, its nice to see the company now has full and unconditional rights to the PIC technology.
4. Patch technology sounds intriguing.
5. My personal feeling is that sale of Cal Tube at outlined price is inadequate. Why sell a unit that's making money even if margins aren't quite to "high tech" standards.
6. Page 26. I don't like "The Company has become aware of certain ground water and soil contamination at the Santa Cruz facility formerly occupied by CTL. The company has engaged a consultant to determine the extent of the contamination and the cost to remediate. However, until the buildings at the facility have been removed, further site characterization and an estimate of the cost to remediate cannot be determined." Maybe this is a reason to sell Cal Tube at the price outlined if the buyer assumes the liability.
7. Page 30. 81 employees and a net loss of $16,481,000 (p37). That's over $200,000 per employee - such a deal.
8. Pages 32-34. What's with all the unregistered securities??? Is this legal? Just about everyone and their sister-in-law is listed except me!!!
9. Page 35. An underwriter getting an 11% commission !!!That's obscene. I need to change occupations.
10.Net loss to Common Shareholders is over $18,000,000. Now we're up to $222,222 per employee. (Page 37)
11. Why does p 37 show only 18,000,000 shares instead of 32,000,000?
I wasn't able to digest more than this in one sitting. Sorry!!! Someone else want to pick apart the next 30-40 pages??? |
