QS Energy Inc (QSEP)

[Flubug]

AISI,

Thank you for your informative post regarding the increase in revenues the pipeline companies will enjoy by employing the AOT into there pipeline systems. Sano stated in an earlier reply to my e-mail that revenue royalties would be out of the question as the pipeline companies would simply buy out the company if these ongoing payments were required by STWA. This brings up two important questions. If Sano is correct that no pipeline company would make royalty payments over time against incremental revenue gains due to the AOT technology, then what would the value of the company be? $10.00 or 15.00 per share would be absolutely unacceptably low given the potential for future energy cost savings and increased flow revenues to be reaped by the pipeline companies due to AOT. The other course would be to factor these dollar amounts into the upfront cost of each AOT unit. This might make the pipeline companies bristle a bit at an asking price of between 20 and 30 million per unit.

Maybe the real answer would be to not sell AOT tecnnology but to lease only. That would be one good way to guarantee a continuing revenue stream for STWA going forward and to also allow the customer base to upgrade to the newer versions of AOT that STWA will offer as the technology is further developed.

The point is that future revenue from the pipeline companies as some percent of their cost savings and profit increase due to AOT
is THE MOST IMPORTANT PART OF THESE CONTRACT NEGOTIATIONS and this opportunity should not be frittered away because truth is this first contract will be a precedent setting agreement that will dictate how this business is to be done in the future so Gregg, take your time and fight for the best deal you can get that includes royalty payments. EVERYTHING IS NEGOTIABLE.