I received the following late last night. Interesting dilemna for shareholders. I haven't decided.
February 21, 1998
OPEN LETTER TO SHAREHOLDERS
FROM: BOB MESSENGER, PRESIDENT
As most of you are aware Triquanta has been through a difficult period in the past 3 months.
The Company was Cease Traded by the Alberta Securities Commission(ASC) and subsequently Suspended from trading by the Alberta Stock Exchange(ASE) for failure to file its audited financial statements for the period ended June 30, 1997. The failure to file occurred because we could not pay the auditors to complete their work.
Over the Christmas period Howell International Inc. was able to re-pay a portion of their shareholders loan providing sufficient funds to complete the audit. On February 13, 1998 we received a completed audit and today we received the interim financial statements for the periods ending September 30, 1997 and December 31, 1997. The latter 2 documents must also be filed with the ASC and ASE by February 28, 1998.
We are now in a position to file all of our audited and interim financials and ask for a revocation of the Cease Trade Order by the ASC and a lifting of the Suspension by the ASE. This will be done on Monday February 23, 1998.
Under normal circumstances the Cease Trade order should be revoked within 2 to 5 days. The ASC will then advise the ASE of its revocation and subject to a satisfactory review of the company's financial status by the ASE the suspension from trading will be lifted and trading will resume.
I believe that the ASE will not lift the suspension until Triquanta can show that it can meet its obligations to creditors and it has sufficient funds on hand to cover its basic overhead for the next 6-12 months. In addition, I believe we should have capital to invest, by way of a Shareholders Loan or Debenture, in Access Developers, LLC.
In aggregate, the company requires approximately $300,000 CDN or $200,000 USD to accomplish the above.
I have approached a number of Brokerage firms and private sources for this amount of funding and I can tell you that, at the present time the market for Private Placements in development stage companies such as Triquanta, is almost non-existent.
The reason for the lack of response would appear to be rooted in the problems in the mining and oil & gas industries which traditionally dominate the Vancouver and Calgary stock markets. The lack of liquidity in shares of the junior mining and oil and gas stocks has lead to a lack of buying power by the brokers who would normally be able to quickly and easily place this size of funding.
I will continue to work on this area of the market but feel I must discuss alternatives with you, the shareholders.
If this funding is not completed in the very near future there will be a number of consequences:
1. The stock will not trade and therefore there will be no liquidity, at any price.
2. I cannot continue to personally underwrite the costs of telephone, travel,couriers, etc. and I am not prepared to continue to incur costs on behalf of Triquanta, if I cannot be certain these expenses will be paid.
3. If Triquanta is not an active and viable company I cannot continue to manage it's affairs, as I must, like the majority of you, earn a living.
4. The ultimate result may be that the company's creditors will seize
Triquanta's assets and dispose of them to recover the money they are owed.
None of this need come about, if we, the shareholders, are willing to continue to support the company.
With over 1500 shareholders, if each of us was willing to invest an amount equal to 10-20% of the cost of our original investment in either equity or debt as outlined below, the company would be in good financial shape.
The two choices are:
1. If you are a resident of Alberta you may subscribe to a Private
Placement of the company's shares which will be done at 10 cents per share, these shares will have a one year hold period, or
2. If you live outside Alberta you can subscribe for debt(i.e. make a loan)to the company. The loan will have a 2 year term and pay interest of 12% per annum. Upon the completion of this funding, Triquanta will apply to convert the Loan to equity for any shareholder that prefers to hold shares instead of debt.
The combined amount of the debt and equity issues will not exceed $200,000 USD or $300,000 CDN and will be allocated on a first come, first served basis.
If we can secure this financing the company will go forward and pursue the growth of its two subsidiaries.
Howell International Inc. continues to focus on the refurbished telecom business with primary emphasis on Philippines, Guatemala and recently Brazil.
As most of you are aware these projects have taken much longer to develop than we originally planned, but both Philippines and Guatemala have recently begun generating revenue. Howell also continues to be active with Network Programs and their in-room gaming product, Golden Vision.
Although each of the above can be important markets and products for us, the turmoil that can suddenly occur in these foreign markets, South East Asia being a recent example, can destroy cash flow predictions and result in a loss of public confidence in the company.
Therefore our major emphasis going forward will be on the national expansion of Access Developers, LLC("Access"), our year old Internet Service Provider(ISP).
Access conducts business under the name ACCESS 1, with head office and
administration center based in San Diego, and operations in Orange County, Los Angeles and Las Vegas.
With Access, we have a North American based business with, daily cash flow,weekly subscriber base growth and the ability to open a new, major metropolitan market for their services, every month.
Most importantly from a "market" perspective we have a growth situation in a business that is slated for high growth for the foreseeable future. This growth is a basic requirement in the success of any small cap stock.
Look at some of Access's recent accomplishments:
1. Access sells internet access on a prepaid, annual basis, allowing low costs for the consumer and giving Access high cash flow and low customer turn-over.
2. They have developed a relationship with Ascend Corp., a major internet equipment supplier, resulting in a co-op advertising agreement and an equipment financing facility.
3. Gross Sales and subscriber base have expanded by 30% per month for the past year.
4. Subscriber base has doubled from 1215, 3 « months ago, to over 2600 today.
5. Gross Sales have increased from $22,000/month in November, 1997 to over $65,000 in January, 1998.
In Access Developers, LLC we have a growth situation, which I think can revive the company and the company's share price.
I believe that we must take control of our own fate in the present
circumstances. If you agree, I would ask you to contact me to find out how you can participate in this funding.
I can be reached at 800-565-4408(leave message if no answer), or at
604-732-4354, or by e mail at: buytqt@aol.com
Thank you.
Bob Messenger |
