From my notes of the Conference Call — seven pages, roughly describing what was said but not including any direct quotes from Don unless so indicated. Duration of the call was considerably more than an hour.
The format was JJ Jeffrey asking questions of Don ... questions which had been compiled from verbalized stockholder concerns over time plus specific questions forwarded recently to JJ.
Don described the float as approximately 30 million, plus or minus a few hundred thousand. He prefers to use the strict definition of float as "freely tradeable", or "Shares authorized and issued" minus any which are subject to a trading restriction ("legended" or otherwise). The float wasn't always that high, but when they got upside down in the trading program last year, they couldn't pay the brokerage firm in real dollars so they paid in shares. This also explains why his holdings, as president and founder, represent such a small proportion of the total float, ie he used to have a decent proportion, but when they issued the additional shares, his percentage of the overall shrunk.
About so-called "insiders", Don said that no one has more than 5% to his knowledge. Given what he's seen, he estimates "insider" holdings ... officers, directors, and holders of 10% or more ... totals about 1.2 million, 90% of which is his.
Major shareholders? He doesn't know. He knows there are certain groups which have accumulated, often in street name (which makes it harder to determine), but he is not going to speculate on who has how much or whether they are telling the truth.
There is no current *corporate* concentrated effort to go out and tell the TSIS story in order to find someone to support the stock (someone more than just a market maker), but he did mention two individuals, Al Starkel and Justus Solomon (spellings?), who had stepped in and have done some significant accumulation.
Re getting a bank line of credit before they need it — Don implied that they are approached regularly by people who want to lend them money ... and that he doesn't accept the bit about having a bank line of credit as adding to a company's credibility. He noted that they recently had changed banks, now with City National Bank (which I know of as a major regional business- oriented bank). Having said all this, Don stated that he is looking at the line of credit "avenue, because it's being thrust upon us." But he very certainly hopes they will not need a line of credit, as they have positive cash flow and enough money in the bank "to do everything we want", noting that they do not purchase equipment; they lease it.
Lots of discussion about the "puffer fish" syndrome ... triggered by concerns expressed by a *number* of investors.
"We're trying to get away from the need for that (acting like a puffer fish)" but TSIS never will get away (completely?) "when your clients are so much bigger than you. These people still think we are a lot bigger than we are — I can tell from comments when they talk with us."
(cont'd) |
