andtheretheygo and all,
I would like to start this discussion off saying that I know what 90% of the crowd thinks of when a RS is even mentioned. Most have been around the OTC long enough they have seen what happens to 99% of those that RS. But, to sandbag the issue and not discuss the possibility seems unwise to me. If this discussion offends anyone, then so be it. If I thought GTEL was a normal penny stock that needed a reverse for more shares to pad their pockets and run another leg of a scam I would not be here, period.
I said this before but I will repeat it, I feel GTEL is at a crossroads, in more ways than one. Their business plan is unfolding with carrier traffic ramping up quite rapidly. This carrier base is important as it represents the traffic area we will use for the value added products which will represent the higher margins needed to be profitable. Profitability is projected for the end of June. Projections by management have been pretty accurate and the fact they still say $250MM in revs 23 months from now would take us 8+ times more than 2004 revs... as you all know, nothing is in those numbers for the strat. I am sure we all know this has great possibilities and any addition from that program puts the revs right up there.
The short synopsis above tells me we have a core business that is growing at a decent rate, the business plan is executing now and should bear fruit with increased revenue and profits by mid year. All of the above statements are my reasons to put GTEL in an "actual working company" class, not a normal OTC scenario, imo.
Ok, now GTEL has made application to the AMEX. The first thing I asked myself was WHY? Was it to just rid themselves of OTC manipulation? In part maybe but I would be disappointed if that were the sole reason. The AMEX I believe has more Companies on the SHO list than the OTC. While I hope it trades more fair it certainly is not perfect and only continued execution, growth and profits will move us, no matter what exchange we are on.
I mentioned crossroads before. The continued execution of the business plan is the first part, the second would be financing. I honestly do not believe GTEL can continue to give the farm away every time they need some dollars for expansion. Let's look at the $15MM Caterham package. We were desperate for the funding at the time and without it I am not sure where we would be. So I do acknowledge we didn't have much choice. That deal gave Caterham 50%+1 voting power on the authorized as long as they don't convert more than 15%. If they converted all the first year it would be equal to approx. 350MM shares based on 1B OS....
GTEL needs to have conventional type financing available to them in the future. The future being soon. This is the paragraph that was deleted from Jan 10th shareholder letter..
"The NASDAQ OTC Bulletin Board has been good to us from the standpoint of liquidity and it has served us well. We have used stock for funding and the cost of financing and funding has not been reflective of our potential. By moving to the AMEX, common stock would be the commonly used capital tool of the company rather than preferred shares that were used in the OTCBB and we will be able to acquire the substantial major funding needed now that our projects are being rolled out".
Whether above was deleted or not I feel GTEL will be looking for big money to support a big roll out of core divisions and the STRAT. What else could "substantial major funding" mean?..lol
If GTEL were to go to the AMEX soon, could the major funding be accomplished with the shares that are remaining? I don't believe so. Huff stated the following in the same letter.
Many investors and investment firms have guidelines such that they cannot be associated with firms that do not have a certain status;
Does that mean because we are on the AMEX that these investment firms will now become involved? I don't believe that to be true either. Most institutions/firms/funds need a price threshold also.
Ok, I will now start to answer your question. As investors we are always behind in knowing so at some point we have to put our trust/faith in management to do the right things when they need to be done. I have. If management feels they have the "goods" to go on the AMEX with a reverse to reduce OS, increase share price to attract respectable financing to roll out projects to achieve the business goals then I am 100% behind them. If a reverse would be done I would want to see it across the board. Meaning not only the OS but the authorized.
If this scenario were to be implemented, I could see GTEL selling some shares from the treasury to finance their own projects and put some cash in the coffers until profits pay the bills..
Summary: With GTEL moving its business plan along I believe the time is right, with the move to the AMEX, to restructure in such a way to promote the business and shareholder value. Remember, I am answering a question regarding a reverse split. I am in no way saying I know there will be one. Sorry for being long winded but I felt I needed to explain my thinking with each step...At this very point in time I am convinced GTEL will become a strong solid company, therefore I need to trust those in charge to do what is best for the Company and shareholders....thanks...rock
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