Sorry for the late post but my life is rather complicated at this time in addition to it being "tax time" again.
Anyway, Sam returned my third phone call which is basically par for the course. He was out of town for a week and had much to catch up on. I covered several issues with him including the business trip, financials from Sherb, progress on agreements for oil sludge processing, status of JV success, and most important the "state of the company."
As for the business trip, it was an incremental trip to further the progress of the agreements they are trying to close. There will be other trips necessary before they are finalized but when completed they will be "very lucrative" to the company. I've always said that 2007 will be "our year" and Sam agrees. They are "making money" even with the lower production because of weather (if any of you live in central US or in the Northeast) the weather is just as bad in Russia and things progress slower.
As far as the financials, Sam is so fed up with Sherb he could scream. They continue to ask questions and send invoices and Sam answers and has to pay. He expects (hopes) final resolution should be the end of this month. He is currently interviewing accounting firms for the 2006 & 2007 financials. This is not progressing quickly because his time is totally prioritized for profits and getting signed solid agreements.
The JV is making money (close to $1 MM so far) even with the slower progress. This will increase exponentially once the weather breaks and new equipment orders are fulfilled by the vendors. Just so you know, most of these equipment manufacturers require 40-50% of the total order amount before they start working on the order, another 35-40% upon shipping and then the balances during various phases of training, start-up and final adjustments. The important thing is we are "rolling" with what we already own.
As far as the "state of the company" Sam knows it will ultimately be a real success. But the processes to get to that point do not coincide with investors desires. Sam can't help that. He is just doing what he has to do to finalize them sometimes working 20 hours a day because of the time difference in Russia. As for myself, I am "sure" he will succeed and those of us who have had the wisdom (based on solid DD) will be more than amply rewarded.
I also requested more frequent updates from him for the shareholders and his reply was and I quote, "I do not have the time to do that, those of you who have been here from the beginning will welcome them and believe them, others will twist them negatively and claim we are stalling and misleading investors. Any news releases will only have verifiable truthful facts and the timing of those releases are determined by when these facts are available. Besides you should know that by now because you people check everything."
I had a good laugh at that reply because it is true! We check out everything even though we really trust the entire management team. We have never caught them in a lie or it would have been intensely questioned and posted on the boards that we frequent.
In speaking with Joseph today I basically got a confirmation of everything Sam told me. I also asked Joseph about the NSS problem which was about 6.6 MM shares three months ago. Through his efforts with the CDC and DTCC it is now down to 28,000 shares. A mere pittance and he is still invesigating those. So the volume we are all seeing is not naked shorting but daytraders and momentum players. No loyal longs I know of are selling, they are buying. Sam and Joseph have no control over this except to say that all of managements shares are restricted and will continue to be until they go to another venue (AMEX). Joseph owns more than 9 MM shares which he bought with his own money and has not nor will he sell any. He is a paid consultant of Strat (but has not received a cent yet and is not worried) so maybe you can all get a better picture of the honesty, integrity and work ethic of this truly remarkable management team. The risk/reward factor on this company is probably better than any other company in "pinkie land." Go figure.
My advice is simple, don't watch the price unless you are a buyer. If you can't stand the pressure, get out. The longs will always be here to pick up the pieces and get rich. I'm absolutely convinced that this will be the biggest winner in my lifetime.
I will be glad to answer any questions regarding clarifications about anything in my post. But understand this, Sam will not give out any information that could be remotely considered "inside" information, nor will I accept any information like that. As far as information goes Sam is the only real source. There are no leaks in Strat Petroleum.
