Did you see this company response posted by GT1….
I've had discussions with Ben regarding questions to some of the past PR's. He was able to compile some of the more common questions shareholders had and send them to Jon for answers. Below are Jon's direct responses.
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How much of the $8 Million Yorkville Advisors financing referred to just Prodigy, how much was allocated for the third-party producer and what was it used for?
We raised that money long before we engaged with 3rd party producers. Prodigy will remain as the central operations point for our work in Vietnam and we will fund it as such. Our objective is for this facility to operate as an egg producer and quality control center for all production in Vietnam, internal and outsourced. 3rd party production allows us to scale to level far greater and, as such, will, in the long term, represent an increasing expense that is directly linked to increasing revenues and profits. 3rd party production increases and expenses will be directly tied to sales, revenues, & profits.
What’s the difference between the multiple-strain hybrid silkworm model, multi-line hybrid production models, and single-line cross-hybrids? What’s the difference between the single strain hybrids and dual strains that will be rolled out?
Our original spider silk transgenic silkworms were developed at Notre Dame using silkworm strains that were targeted for research purposed and not optimized for commercial production. Since bringing technology development in-house with our own development team we have transitioned away from the use of research strains of silkworms and now work directly with commercial production silkworm lines. The “Single-line” or “Single-strain” cross-hybrids are the product of using a single commercial silkworm line that has been modified to incorporate our recombinant spider silk proteins. These lines are intended to initially be raised and mated within the single line for successive production batches of silkworm, cocoons and silk.
The second step in this process is to create multiple lines of these “single-strain” cross-hybrids. Industrial silkworm egg production is done using a multi-step process where multiple lines of silkworms are first raised independently and then mated between strains to increase overall robustness and cocoon size. While a slightly more complex process it yields great amounts of silk, increased robustness, and lowers overall production costs. The cross mated offspring are deemed to be “multi-line cross-hybrids”. These multi-line cross hybrids are raised for a single generation which is all used for silk production. Successive generations of these multi-line cross hybrids are created by re-crossing the single-strain hybrids to generate more first-generation hybrids.
Please see graphics below
Single-Strain Hybrids
2 Strain Multi-line Cross-Hybrid production Model
If R&D lab is already ramping up the multi-line hybrid production models and expected to transition to production in Q1 2023, why do you believe that you can’t produce quantity until late 2023?
Deployment of the Multi-Line hybrid production system is expected to begin in early 2023. The multi-line model required at least 2 generations of silkworm rearing to get to final production eggs and cocoons. We will also be implementing the four strain multi-line hybrid system to further improvements in yields and performance. These technologies will be rolled out in a continuous wave of production improvements which we will update everyone with as they are put into operation. We will continue to produce the current Dragon Silk strains and transition to these newer cross-mating technologies as they are finalized for large scale production.
How is the quality of the spider silk that you have in inventory for SpydaSilk?
We have not observed any deviations in material quality from our 3rd party producer. Post processing of the silk cocoons to raw and finished silk has been one focus area of our production partner. Transitioning from manual to semi-automated to fully automated cocoon reeling has been a significant focus as it has impacts on the quality and quantity of finished reeled silk that can be collected per ton of cocoon.
What’s the plan if they go with another lockdown?
Assuming the question concerns another potential lockdown in Vietnam.
Prodigy Textiles was able to continue operations during the restricted travel permissions in Vietnam linked to COVID. As an agricultural operation it is a sustaining business for local farmers and workers. During the lockdown members of the Prodigy team resided at the facility to sustain our silkworm colonies and keep operations moving.
The Company also created self-reliance at our factory in Vietnam by planting mulberry field’s at the factory to supply on-site and continuous access to mulberry year round.
Is the third-party producer using a climate-controlled environment or is it strictly outdoors?
They use traditional systems for rearing which is a blend of different levels of control based on egg production, young larva, and adult caterpillars. No production occurs outdoors.
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Also, It sounds like the company will start to communicate some of the more pressing questions that shareholders have in the form of upcoming PRs. I don't know what these answers will be but hopefully it clarifies the substantial amounts of silk that have been produced concurrent with these upgraded lines.
