Capstone Green Energy Corp (fka CGRNQ)

[Seasound]

Darren R. Jamison --$932,000 calculated 2012 compensation isn't too shabby for a CEO, President, and director of a company that has yet to make money. Go back and listen/read to the previous 4 to 5 years CCs and you will hear or read a common refrain of Y/Y growth, a certain product will be the turning point, warranty cost, royalties, this or that distributor needs weed and feed, backlogs, and expectations of profitability being just a year or so out, etc.

Think about this... DJ came "onboard" in 2006. As recently as 2008, most forecasts showed the United States growing increasingly dependent on imports of liquefied natural gas (LNG)--A Paradigm Shift A few short years later that whole forecast was turned on its head by new technology (mainly directional drilling and fracking) to release a glut of domestic shell gas. 10s of thousands of wells have been drilled; many now closed in awaiting infrastructure and a favorable prices.

U.S. gas production has increased 28% since 2005. In 2011 about a third of that production was from shale gas, up from just 11% in 2008. By 2035, according to a study by the research firm IHS Global Insight, shale gas will account for 60% of U.S. production. DJ states that the oil and gas industry accounts for the lion's share of sales and is likely to remain so. Had it not been for this whole new oil and gas extraction technology would Capstone still be in business? I personally doubt it.

On the other hand we are entering The Golden Age of Natural Gas Although the predictions for domestic production here in the USA alone are impressive, the global predictions for drilling and production are staggering. This too is the Golden Age for Capstone if management is able to execute business plans and deeply penetrate this market quickly enough (perhaps the Origin/Aquatec-Maxcon talk of of 100 C1000s will translate into sales and deliveries and will clear the path.) Let's hope so, as the golden ring only comes around once most of the time.

There has never before been such an opportunity for Capstone, and in my opinion if they can't execute and turn a profit in this environment the end of the company is inevitable. At the moment the oil and gas industry is our playground, but other companies and technologies are making inroads. The time has arrived to execute and survive, or be shunted aside with nothing but a long history of hope and projections left as evidence of what might have been.