I reached out to management via email on Thursday (Phil Anderson & Dan O’Neill). My goal was to get their attention while letting them know I consider myself a somewhat serious, knowledgeable, concerned investor who was looking for some information. The text of the email I sent follows:
Gentlemen,
I am a current investor in the company. For weeks now I have attempted to sign up to receive all investor related materials; Annual Reports, Press Releases, Financials, via email thru the “Investor Resources” page on the company web site. Apparently this option is not functional? As a former IT professional I find this quite discouraging. I personally view this like a company who “doesn’t answer their phone”.
With everything else going on right now with the company I must question how much this should concern me? If you are not able to fix it, I would suggest removing the option and providing another method to make the request.
Due to the recently filed “DEF-14A” I want to make sure I receive any subsequent filings with additional information as to why I should vote to approve either proposal. I currently hold 405,000 shares, where 397,000 are eligible to vote but not yet voted. Since you have not provided any details regarding the “preferred shares”, specifically the voting rights, I cannot vote in the affirmative for that option. I would like to vote “yes” for the reverse split, but I need some assurances the newly available authorized shares as a result of the RS will not immediately be used to dilute us back into oblivion.
Do you plan to release “anything” before March 10 that would convince me for approval? Do you have a projected date for when the 10-K will be released? Is there anything you can tell me regarding my concerns?
Sincerely,
Within a couple hours I received a reply from Don at the Piacente Group (Investor Relations) stating “Dan O’Neill asked me to speak with you”. I set up a time for Don to call me on Friday. He called me promptly at the specified time.
For the record, he basically said the kind of stuff you would expect. There was NO grand-standing, hint of “big things” to come, etc. The thing he said most is “I’m limited in what I can say”. I was afraid he would almost be reading off a script so when I thought that started, I did my best to get whatever I could. It was at least a 10 minute conversation so I obviously can’t quote anything verbatim. I’ll do my best to offer “my opinion” of what he was saying. Keep in mind I think to some degree we “all hear what we want to hear” so I tried to be cognizant of that.
MOST IMPORTANT thing I heard:
Q: How is the RS vote count going?
A: I’m not sure about the actual numbers, the CONCERN is receiving enough votes for a quorum.
Sounded like they are not on track to receive over 50% of eligible votes. He kind of blew-off the RS itself. This would explain the multiple requests for our votes.
I flat-out asked if management had a pre-split PPS in mind or a split ratio they were leaning toward (not really expecting an answer). He more or less blew-off the question and said they need the split to provide capital for the business to go forward. IMO, they are NOT considering the PPS right now with regards to an UPLIST! Said something about that would be 2 or 3 quarters down the road.
He couldn’t/wouldn’t comment of the amount of remaining debt or the status of the balance sheet but implied the “primary” reason for the RS was NOT to immediately resume CD dilution.
I said I could not vote for the AS without knowing the details regarding the preferred shares and he didn’t seem to care.
I said there were rumors of Q4 revenue being in the $40 mil range and he went nowhere near my comment. I also said I knew if the RS were approved it couldn’t happen for about 20 days after the vote which would coincide with 3/31 earnings. He kind of laughed like “I was on to something”. I told him a brief PR to say when earnings would be reported along with a revenue estimate would go a long way in shareholder confidence to vote for the RS. I also said “surely as of today they must know the Q4 revenue”. He said he would “pass along” my suggestion but they may not know actual revenue yet due to distributor deals.
I asked if there would be a PR announcing Phil’s official start & he implied “no”. When I asked about a PR regarding debt restructuring progress he said something along the lines “a PR has already been issued about Phil and that they were working on the debt. Another PR would not be issued unless something was complete”.
He was not aware of the web site issue but agreed with me and said he will look into it. Said he thinks that was left-over from the previous PR firm and had to do with the “IPO”.
I mentioned the connection to “Atlantic Vapor” and the predicate product. Let’s just say he laughed at the idea that ECIG would be shelling out any money here.
