Hemi Trip Part 2
The Fort Worth Stockyards are beautiful! The whole area is a lot of fun. The exchange building is incredible! Hemi has three offices in the exchange building. Keith's private office on the first floor, the main office where Joyce works on the second and a third first floor office kept in preparation for the companies future growth. In fact, Keith's office is right next door to Willy Nelson's. Mr. Nelson has a music production company there. We spent the first afternoon eating with Keith and getting to know him. Keith is genuine and very knowledgeable. He spent six years in the Marines and graduated with his MBA from Texas A&M. His work as an analyst on Wall Street has given him important lasting connections with very wealthy people in the oil business. IMO we will see this relationship influence Hemi in the future. Keith has a great sense of humor and was very candid in his replies. A member of the Hemi team that needs mentioning is Joyce. Joyce acts as an office coordinator and secretary. This woman is fantastic. She has over 30 years in the oil business and does she know her stuff! She receives a small salary and stock options. She became a part of Hemi because she saw a legitimate business plan and incredible potential. From her experience she recognized Hemi Energy as being the real deal. Now, Keith was very good about answering any question as long as it would not constitute insider information. First of all. Both Craig and Keith have 100% of their shares in certificate form as does Joyce and John Kelly. ALL shares that have ben issued this year are restricted. Keith is a aware of the naked shorting and ia considering a plan of action that would help shareholders in more ways than just forcing the MM's to cover. That is all I can say about that. As far as the Wilshire deal. Keith was told that they had accepted the terms so John Kelly went to meet with them. Once there, Wilshire and the potential investors said the check would be signed once 25% or 25 million shares were added to the deal. So, Keith refused and left the original deal on the table for them to either accept or not. Keith WILL NOT include shares as part of the deal. According to John Kelly, they are still very interested but will have to agree to the deal as Keith presented or there will be none. Keith has previous employers in NY who have not only asked Keith to come work for them again but are very interested in what Hemi is doing-that is all I will say about that. Keith was adamant about no financing deal that included dilution. So for now the ball is in Wilshires court. As far as the new shares that were issued, Keith said much of it is just sitting there in case they need it for the lease deals coming up. They wanted the shares on hand in order to seal the deals as quickly as possible. He said if they find they will not need all of them then they can always retire them. It's all about moving on these leases as quickly as they can. Keith said uplisting is still in his sights once revenues build to a certain point. In the mean time he is considering being fully reporting while still on the pinks. Some things went on in his office while we were there that cannot be commented on but our patience will pay off big-IMO. As far as the past PR's Keith agreed that in an effort to get information to his investors too many forward looking statements have been given. He said he is going to try to release only information that has been established. The actual production numbers are to be released shortly as is information on new deals being done. IMO Kansas is not the only play being looked at right now. Also,IMO Kansas gas will play a huge part of the plan. Keith showed us some of the geological reports used to identify Kansas oil and gas. Man, some of them are ancient. Without a doubt a buy-out is still the plan. With that in mind I talked to an old retired oil man at the White Elephant saloon. In general terms I questioned him. In short, he said that buy-out business plans are common in the industry and happen often. Keith mentioned how much help the Haas family had been also. Keith KNOWS this industry inside and out! One thing he did say I could share was that the Mississippian formation in Woodson still has yet to show promise. Not like the squirrel formation which is proven. Hemi may attack the arbuckle formation in the near future. Keith knows that there is prolific gas and is excited about drilling on the new leases. He said the number one obstacle is manpower. They are working on equipment shortages and are sure that can be addressed. But they need workers. They are not in a position to pay 150,000 a year for experienced oil men from TX & OK. Keith is totally confident a solution will be found and since they are debt free and making money he is looking at it as a bump in the road. IMO there are a couple things in the works right now that would increase Hemi's revenues exponentially over night. This would open the doors to develop the Kansas leases much more quickly. More leasing is going on every day, both the accepting and rejecting of. Keith has secured leases in another part of Kansas that I am sure he will announce soon. Keith, Joyce and John are all very excited about everything going on. Keith says this plan WILL come together. It does take time and obstacles must be overcome but it will happen. The local competitors have abused the land and mistreated the land owners in the past. Hemi is the new guy that does it right and news has spread! While in the office, two KS landowners called wanting to talk leasing and two other calls from NY. It was actually hard to talk with him until we got him out of the office! LOL. Leasing in Kansas is coming to fruition but will probably always be ongoing to a point. Keith said as some wells close down others must be developed so leasing can never really stop. However, the current leases in Kansas alone can keep Hemi busy for a decade or more. There is so much land that has yet to be touched and Keith is wanting to get at it. As equipment and manpower issues are resolved he plans on making Hemi a force to be reckoned with. And I can tell you that locals, landowners, suppliers and subcontractors agree. The offices are beautiful, the vision is big, the management staff is honest and true. They are experts in the oil patch that much is for certain. Keith was honest about Wilshire, the Mississippian formation, the equipment and manpower shortages at the moment etc. All of this being part of a normal day in the oil patch. Keith, John and Joyce are good people. The company and it's vision are for real. And everyone around them knows it! They are not perfect and Keith apologized for that. He wants to make sure that future PR's are strictly a refection of what HAS happened. The two investors that went with me agreed that Hemi is a solid company with solid fundamentals, a great reputation, a good business plan, honest management and are definitely GROWING every day. Hemi is known not only in KS but in CA and NY too. I feel better than ever about my investment. On our four day trip we saw the oil and the land. We spoke to the crews and the locals. We interviewed suppliers and subcontractors. We had in-depth conversations with Keith and Craig. We spoke with Joyce and heard from John Kelly. We were able to see first hand how landowners flock to Hemi everyday with lease deals. We walked through the beautiful Hemi offices and can confirm the long hours being worked. We experienced Keith and Craigs humility as they apologized for for steps taken that could have been done better. In the end, while not perfect, Hemi is without a doubt a real company doing real business which in my opinion is going to have a real bright future.
