Eco-Safe Systems USA (ESFS)

[Pleepleus]

Ok, here’s the breakdown of my conversation with Michael.

SALES

The recent purchase of a unit by Seaworld in Florida (which they are using to sanitize dive equipment between uses) has given them some new leads. Currently Eco-Safe is talking to five companies in Florida that are all showing strong interest (although he didn’t mention in what industries). Additionally, Cheesecake has given them five layout plans for new stores - so that’s another five installs that will happen in the coming months… or so. And, with the install of the upgraded unit in the Venice Whole Foods, they now have units in 13 stores total with more coming on board eventually. They also gave Bumble Bee tuna a bid today for a new plant they are building. He said they have a strong interest and a budget of about $1mil to spend.

Lastly, when I asked if bacteria outbreaks such as E. Coli and Salmonella are leading to more phone calls from the food industry he said yes, absolutely, and mentioned that he recently received calls from companies in Germany and Spain. Although no deals have been made, they are discussing how best to start selling overseas.

NEW PRODUCTS

The Hazmat unit is about two months away from military testing that will take place at UCLA. Apparently, the military is spending $250k to test it. The head of the LAPD Hazmat encouraged them to build the unit and has been involved. If the Hazmat unit tests are a success, which he feels is very, very likely, this could lead to a ridiculous amount of orders. Specifically, he said the military (and I believe police) would be looking at about 3500 Hazmat units. And they are apparently going to be expensive because, according to Michael, that would be about $1 billion in orders. Seriously, that’s what he said. One billion. He also said that he thinks they should be selling the new Hazmat units before the end of the year – hopefully as soon as October.

Also, the Septic tank units are still alive. The county of L.A. has bought two, which are in Malibu (one of them I believe is in the Fire Department), and they have been successfully tested. After a three week period with the unit they show 0% bacteria which is huge. They are currently waiting to be NSF certified, which should be no problem, and then they should begin selling them. He believes there’s definitely a need – in the Malibu area alone 1200-1500 units could eventually be expected.

http://www.nsf.org/consumer/about_NSF/cert_benefits.asp

PATENTS

They are still working on patents for every single product. He said something about an investor, I assume a large investor, who is helping to pay for the patents. I’m not sure what the details of that arrangement are though.

SUMMARY

I maintain a somewhat cautious, but extremely optimistic holder of ESFS shares. Like many of you here, I'm also very frustrated by the lack of sales and subsequently weak pps. Michael did address this problem and said he finds it troubling when he sees the stock price down at .09 or .10 like it has been recently. However, he continues to believe our day is coming and when it does it will be very rewarding. Will we ever get to the promised land? Or, perhaps $.20? Nobody knows for sure. I just hope that if they do execute their plan and the company explodes, I'm still young enough to properly enjoy the benefits of my riches... cough.

-Plee