This covers a few points different from my previous post (#21370) which discussed where Implant came from and where it's heading:
1. Financing and DMRJ: no one likes the DMRJ dilution, except DMRJ. But Implant would assuredly not exist today if they didn't bail us out. DMRJ has partners and shareholders and a fiduciary duty to maximize their return. I'd be buying our stock at 8 cents a share if I were in their shoes. As investors, we look at Implant today when it's less risker than it was six years ago. DMRJ looks back at conditions six years ago and reminds itself of the enormous risk it took. Our perspectives are different. Let's face it, six years ago, if Implant were a horse, it would have been shot. Execute on sales and we'll generate revenue to pay off the loans. The TSA contract is a start. In the meantime, we need to keep in mind that recent loans from DMRJ were more favorable to the company. As I understand it, there are two loans that DMRJ subsequently made for $12 million each. One has a convert at $1.09/share, the other at $1.18/share. And I believe that there is a smaller loan that has no conversion privilege (this was discussed during the CC, not all of which I got). The $20 million loan we signed a year ago with another (unnamed) investor had no conversion clause. So we are doing better. Implant is hammering out with DMRJ terms for the new loan as of March 30, and I imagine they are fighting to avoid conversions. And a reduction in the 15 percent interest. They might get the former, from the sound of comments in the CC, maybe not the latter. But we shall see.
2. Management not purchasing IMSC shares with their personal money. This has come up on the board frequently, and I just don't see it as relevant to a commitment to the company. Bill McGann, Darryl Jones and others have a significant investment in Implant by their very presence, and their stock options. I doubt if McGann needed a job if reports are accurate that he sold his former company to GE for millions. Jones left a secure, high level job with a very large company to work for the laughing stock of the industry. That would be us a couple years ago, before any sort of qualification, anywhere. Jones and others who didn't come in rich, who took the risk with a company whose only attraction was potential, would be foolish to put their savings, if any, into the marginal company they joined. They may not have the wherewithal in the first place, and in any event, if they were going to put money into the market, they needed (and need) to diversify. IMSC stock options could make them rich, which is why many, if not most of the top level team, is here. It makes no sense to risk the family's saving by doubling down on IMSC.
3. The press release on Glenn's departure. One person on the CC was quite upset that the press release was so curt, avoiding a thank you to Glenn. I think we all wondered about it. However, I believe Bill gave us a clue as to why: as he said, we had to go with what Glenn wanted. I suspect Glenn was shocked by the dismissal, and understandably pissed off, and said something to the effect, "say what you want, I don't give a dam, I'm out of here". That's pure speculation, but during the CC Bill acknowledged Glenn's very substantial contributions. So it's not like he wasn't appreciated (The Buff aside).
4. Little information provided about the upgraded Q150. Bill said he was amazed with the new version. Why say more? Certainly the competition would like to learn its features, announcement date, etc. I'm delighted Bill's response was one word.
5. Bob Liscouski Board member versus operating executive. Someone asked that since Bob was a Board member and the company struggled, what difference would he make as the executive vice president. It can make a big difference. As I understand it, Bob ran a security business. That presumably was his livelihood and required most of his attention. I was member of a number of boards, and that was the way it was for me. My board responsibilities were important and I took them seriously, but I had to put more of my time and energy into my day to day business, the one that enabled my kids to eat and my wife to shop. I understand that Bob's main attention from here on out will be on Implant, and that's a very good thing.
6. Final thought (for now): I thought Glenn was very effective; he got us to where we are today. He's here no longer, fair or not. If there had to be a change, I think McGann and Liscouski are the team I'd want in his place. Bill offers unsurpassed technical and product development experience and visibility in the very industry we serve, as well as management experience in a number of high-tech companies. Bob brings years of experience in the security business, a background that included important years working in the Bush administration, and contacts galore (as does Bill). He knows his way around the security industry here and abroad. They are both straight shooters, as the way they handled the CC indicated.
Darryl Jones, the other executive key to our need to, finally, Execute, has been forced to spend his time since arriving at Implant chasing certifications. Without them, and deeply in debt, competitors were killing us. The TSA contract has changed the marketplace's perspective, and created a more level playing field. There are no longer significant barriers to sales. Jones knows that, and as he said on the CC, he finally is in a position to go after large opportunities, opportunities that were out of reach of Implant until just a few months ago.
I can't wait for tomorrow because the future gets brighter every day!
