***********TO ALL************
Myself and Beeblebrox have just completed a conference call with Mr. Gordon to address some of the most pressing issues at hand.
The following is what we found:
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1.) The first question I felt that needed immediate answer was regarding Mr. Gordon's selling his 6,480,000 shares per the S-8 filed on June 25, 1998.
Mr. Gordon DID NOT sell his shares into the float and into the open market. What he did do was sell his shares to a private investment group and, in effect, actually placed these shares as collateral for a loan that, once received, was then loaned to TSIG. He told us that he is able to recover these shares, upon repayment of the loan, and that this investment party agreed not to lend these shares out to anyone for shorting purposes, nor will they sell them.
2.)The next question involves Mr. Gordon's involvement with Phoenix.
He was the CEO for about 12 years and resigned Nov 2 years ago. He replaced himself with the former head of Unisys. Mr. Gordon's only remaining role at that point was a position on the board. The new CEO then basically cut Gordon out of the loop and all of Gordon's management team was eliminated and replaced by Unisys people. At the time Gordon resigned it was a debt-free company with $11 million in cash. They were on track to cut over to profitability within the next 12 months. Gordon was also negotiating $10 million financing from Soros. Which was supposed to be closed in June and the new CEO wanted to take over the negotiations because he wanted some refinements and so Gordon allowed him to do so. The deal then continued to get delayed until Nov when the current management had completely drained all the resources of the company and without the financing forced the company into Chapter 11.
So we can see that Gordon was not at all responsible for the failure of that company.
3.)The next question was about the Teleservices Holdings Company or (New Co) and Gordon's involvement.
Gordon says that he is in no way affiliated with New Co and has no interest whatsoever in their operations except for the 6% that TSIG owns of them. He doesn't even know the phone #. This New Co, will in a way, be competition to TSIG. The New Co is a combination of 4 small teleservices companies (the largest being $4.5-5 million in revenues). The only reason the New Co was formed is because Gordon had a plan to acquire about 5 smaller teleservices companies that were turning away business because they were too small. Gordon wanted to add these businesses to TSIG's business and expand that way and at the same time help these other companies grow with TSIG's capabilities. Gordon's M&A plans were derailed because of the share price of TSIG. These deals were going to be 100% equity deals and because of TSIG's share price decline Gordon wasn't happy with the dilution to shareholder value as a result. So instead they formed a New Co and placed Gordon's proposed acquisitions in that entity. Gordon says that TSIG instead entered into the CCI acquisition which he believes to be a business which will be much more exciting, more profitable, and having more growth potential. So Gordon is very happy with the acquisition of CCI instead of these 4 smaller teleservices Co's.
He also stated that the management that left was not "key" management like Berry had said. They WERE key in the fact that they were the old CEO and directors, but not key to TSIG's success. This former management had no teleservices experience before TSIG, unlike the new management team like Alyce Cucurullo and Timothy Heidemann with years and years of major teleservices experience with big name companies like AT&T.
Gordon didn't say this, but it is apparent that this is not key management considering the great hole of debt and losses that this team put TSIG into. So I am very happy to see them go.
Oh, by the way, Gordon is not working PART TIME at TSIG. He says he puts in about 80 hours a week and his only commitments are his family (wife and 4 daughters) and TSIG. That comment in the S-8 filing (about Gordon having other obligations) is only because Mr. Gordon still technically holds a position on the Phoenix board. This company is soon to be dissolved from what I understand, this is my opinion based on what Gordon said.
Also to answer another one of Berry's questions the offices of this New Co are located in Chicago, Massachusetts, and Florida. The 4 former TSIG officers were dispersed in the locations they lived the closest to: one lives in Chicago, one lives in Mass., and two live in Florida and that is how they were placed.
4.) I also asked a question regarding completion of the CCI acquisition.
The Compact Connection audit has to be filed by July 13 and it will be filed and the 6 million shares of stock will then be issued to CCI. Gordon assures me that it is a 100% done deal and that this is just a legal formality which will be 100% complete by July 13. Sorry Berry no chance of it coming unwound.
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That is about all I feel needs to be addressed at this time. All the rest of our conversation I will save for Mr. Gordon to address in the CC with everyone. I did talk to Mr. Gordon about my CC idea and he is very interested and we will be setting up a definite time and date soon.
I came away from this conversation extremely pumped about this company's future. There is no doubt whatsoever in my TSIG stock and I am thrilled to pick up more at these prices. I can only say my doubt and concern of yesterday has been washed away and replaced by smiles and joy. I am advising all my friends to greatly increase their holdings in this company.
I will be dreaming of $ signs tonight...
SEE YOU ALL IN VEGAS!!!
We are still going, have faith all!
Gambler
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