New cleaned up version..Why do those numbers appear when you cut and paste?...Strange..Also added spaces....Aloha
This is from a little phone conversation I had with Dr. Phan recently..He said to ask any question I could think of...This is what I came up with...Hope it answers some of the questions that you folks have had too.....These responses tell me that Hrct is running at full speed and it's management is constantly trying to find ways for Hrct to grow..There are many things going on in this complicated network of companies...When one thing works like a charm, another is stalled for one reason or another..Then there is China and it's laws...Hrct has done a remarkable job to be where it's at..Small company that will show profits very soon....It will be interesting to see how it does in better economic times...jmho
Hope these replies are coherent.....Hard to type and talk on the phone at the same time..At least for me it is...lol
Aloha
1. How can Hrct remain in business with such a low shareprice and so many acquisitions on schedule for this time?...
a)We have to find a different ways... Creatively seek ways to accomplish acquisitions without massively issuing new shares...That is a must!....The objective is to maintain growth ...Solutions to this issue are many... Partnerships or venture capitalists and cooperative ways of purchasing a company through their cooperation...
2.Tin, how many shares a month does Hartcourt have to sell to stay in business? At 5 cents to raise $100,000 would mean 2 million shares. If Hartcourt raise $100,000 with restricted shares it most likely would be at a penny a share for anyone to take on that much risk. At a penny that is 10 million shares.
According to Hartcourts own SEC filings they could not even get someone to pay for 8 cent for restricted shares when the price was higher.
a)By cutting expense aggressively, we could cut our overhead cost up to 70 percent... All personel and management team are being asked to defer their salaries...Management believes that we will be able to obtain positive cash flow without major dilution...In times of bad economic conditions we have to do what is necessary to achieve our goals...And we will succeed....
3. Sinobull and their software products have been shown in trade shows through out China...How is that progressing and has SB created any revenues from Metastock yet.?
a)Equis is completing the production and the packaging for its Chinese-version CDs and will have delivery and training done by August. There will be a advertising launch for September.....The product has been tested by some of our clients already with excellent results....Sales should progress slowly at first, but the product is accepted worldwide and we expect similar interest in China...
4. Hartcourt Capital has worked some nice looking deals. How are they progressing and what kind of revenue will these deals generate?...
a)Deals don't happen over night, but the ones we have signed are well under way and they are progressing nicely...I think the PR's have some of the numbers for revenue..I don't have them on hand..
5. Are they working on more that haven't been announced.?
a)There are many deals on tap for Hrct Capital.....There is much demand for the services of a Hrct Capital in China today When these deals are signed, Hrct will issue a PR.......
6. Dr. Ching's China Fund was due for July, will that be on time? Delayed? Or is he having trouble getting investors in these terrible economic times?.
a)China law and regulations are an ongoing battle for Hrct's companies…The legalities are worked out and paperwork has been submitted, we just await the awarding of the fund licensing by the government...This has yet to happen to a foreign firm, but with the changes in the WTO, we hope for a favorable result....Then comes the raising of money, which should not be so difficult in China...Banks give almost no interest to savings accounts and there is always demand for funds like ours.....
7. Sinobull was to have been reverse merged by May31st, what happened to that one?
a) The SEC asked GTCI to redo the proxy....There are about $2 Million in outstanding loans and GTCI creditors having trouble converting with the low shareprice...So it really comes down to existing GTCI shareholders who aren't ready to accept the huge dilution.... It will happen when they come to an agreement with their creditors..
8. AI Asia has some of the best subs Hrct has..Did we finalize any of those yet? and How are we paying for them?
a)Again we are pressed to be creative...Our progress in this area has been fantastic.. Investors should see a PR coming soon.
9. E-Education coming along or stalled for the time being...I see Legend had a PR recently about E-Education...Have we lost any advantage we might have once had?
a)Education in China is a huge market with a great demand....Normally licenses are very difficult to obtain, even for Chinese companies...But luckily we have a deal with Jiaotong..They are well respected and we have a great relationship...Recently we have had a problem concerning the direction of the program, but it is being resolved and the parties are working it out..
10. Do you anticipate any re-occurance of the Hogue issue(s) ??
a)He has the option to refile only in California, but if he does, Hrct will probably sue Hogue to demand court cost in the Florida case...This would likely, be more than the original $40,000 in dispute....It is up to him to pursue it further..
11. Can someone provide some financial revenue / profit figures (even if forward looking) tied directly to some of our business/partnerships ie. such as Kangrun deal ?
a)There will be a PR on AI Asia as I have stated earlier..
12. There was a rumor that Charlie Yang was rejoining the Hartcourt team
in some official capacity.......is that correct ? If so, what is he doing?
a)There have been major cut backs in executive positions, but he is always available to work as a consultant...Hrct is a family and the people that work or have worked for us are all a part of that family....
13. What is Lexington's FIRST major project to PROMOTE Hartcourt/ET ???
There has been nothing from them but P/R releases and a couple of powerpoint drops on their website. EXACTLY "what" are they doing to earn their pay.......and..........drawing new investors towards HRCT ??
a)They have been very busy with investor contacts... They are doing their job and are working behind the scenes...Not all that they do is out in front of the public....I encourage investors with questions to pick up a phone and call them...I have had no problem getting someone in the office.....
14. Can you provide any "concrete" forward looking perspective on "dividend shares" to long-term shareholders??? Is there a plan in place to move off of the otc-BB (( this last sentence is just for EFFECT !! ))
a)I really cannot answer at present...We are looking at ways of moving to a new exchange....When a viable situation presents itself then we will move on it....We have been and will continue to seek favorable alternatives..
15. Who are you picking///////// WINGS ----------- Hurricanes ??????????
a)I am going to be politically correct to EZ and pick Detroit.....
16. I know if the deals are not solid yet then we can't publicize the deals, but is the Radvision China rail deal going to go through Control Tech?...I believe there is also a Country wide deal with China Unicom and Polycom...Are those to go through Control Tech also?..
a)I am not sure of the specifics but in the case of Radvision, there are three employees that occupy space in the Control Tech office...I think they will receive a percentage of the deals that go through them and that may be the case with the ones you talk about...
17.Dr. Wallace stated on his USA tour he will build this company and it will show the results in 2004. Q. what will the estimated PPS be in 2004 ?
a) Anything related to share price is beyond the control of management Besides, it's illegal for us to interfere with the market forces We cannot discuss anything about the shareprice, period...I believe Dr. Ching stated he has a two year plan and at the end of 12 month we will be profitable...
18. Q. what will the estimated PPS be in 2003
a)Again, it's illegal to discuss shareprice..
19. Talk about Dr. Wallace institution investor friend. When are they coming to the table.
a)The overall market is terrible...There are investors that have done their DD but are still sitting on the sideline...They may feel like this is a good time to get in due to the low price but I feel they are waiting to see a sustained recovery before investing...
20. The object of the initial process was to get China companies together under one roof and then bring in a foreign partner that could provide cash to get the most out of these companies...Is that still part of the plan...Do you think we still have a first mover advantage?
a)Yes there is competition, but we are ahead of the pack...Even though the WTO has been approved, China Law is not as quick...We will be ready and by the end of next year our acquisitions should be completed..
21. Speaking of Foreign partners..I see Motorola spending a great deal to make sure they get into China the "right way", are there any US companies that Hrct has talked to and are we close to any kind of deal yet....imo, we have access and approval, all we need is one US partner to make investors stand up and take notice..
a)We have discussion with many US partners ...Many firms are not yet in an expansion mode in this global hi-tech recession...We have to wait for the economic conditions to improve before these companies are thinking of overseas expansion........
22.What can you give us to hang onto till things turn around?
a)I never ask anyone to hang on......Every investor has his or her own personal financial position...Each has different priorities for their money....Investors must make their own choices...I have always said that.....Also management cannot control the shareprice....We must build a profitable company and the shareprice should take care of itself..
23. SB and Reuters?.....Anything there?......Hrct Capital and a large US company?....Seems to me that the scenario for Hrct Capital to be merged by a US institution like Morgan Stanley or Merrill Lynch would be a plus for both them and us...They would benefit from a guy like Dr. Ching running the show and having major ties in China and of course Hrct would benefit by the investment capital from such a partner....These folks have long lists of firms that they invest through...Wouldn't that be a direct line to Hrct prosperity?...and a reason to dividend shares and create shareholder value?...AOL and AI Asia?
a)Reuters needs us to grow about 5 times our current size before they are interested That should not take very long as we continue our acquisitions and growth.....In the case of Hrct Capital it would be premature to do that with the big guys...but with the special license for our china fund, things may happen quickly........Aol is in a different area..not likely to happen....We had talked to them in the past as a part of the COL deal...Right now they don't have any relationship with Hrct... Maybe after the HCTV deal
24. "going forward".......what do YOU see as Hartcourt companies biggest challenge..........there may be many......but, what (in your eyes) is #1?
a)Number one would be the market environment (OTC index, hi-tech recession) and to grow without using shares...The result is each deal will take more and more time to complete while shareholders are impatient but Hrct will succeed..
25. Is there a FIRM date for the Annual Shareholder Meeting (gotta throw ez one in ) ?
a)Hrct is working for end of August in Vegas...Possibly September..
26. Sinobull.....at one time........was positioned as a "first in" / leader's advantage operation.........since then, competition has quickly picked up steam. At the present time, what are Sinobull's biggest / most leveragable "competitive advantages" ??
a)The Sinobull web site is doing extremely well...It will pick up rev....Has strategic partnerships with banks...forex and commodities.......The market hasn't grown yet..There are many things that need to occur post WTO....China moves at a slow pace but things are changing..
There is a new board of trade developing in china....We are always looking for partnerships...HCTV~ government advised us not to create a new channel ...They would like us to pick up one or two of the government channels and co-develop into our own financial channel...We are in discussions on this matter.......
27. We have many partnerships/affiliations/working agreements ie. ToysRuS, Legend, Polycom, Equis/MetaStock, etc. etc. etc. WHICH and WHAT ones do we really have concrete actionable revenue driving day to day operations with...........versus............"betting on the come" ???
a)Majority of revenue of Control Tech come from the Polycom and Radvision contracts and Kangrun from the IBM, HP and Samsung contracts...These companies are established and revenue are growing.... Yahoo! China is a major reason for the success of Sinobull Web site
28. Provide 3 "benefits" ((to corporate business/strategic or tactical plans)) which were accomplished w/ Dr. Ching's road trips.
a)The main reason was for Dr. Ching to meet with shareholders and answer questions....He also had meetings with bankers and other people along his tour.....
29. HRCTWEB..........nearly "invisible " on bulletin board ! Why?
a)It is just not possible for him to be on as much as he had in the past...He has had health problems and wants to be home with his family more...He had worked an impossible schedule before and needs to slow down..
30. During and/or after the "tech boom" we may now realize we paid WAY too
much for acquisition companies.........are there any plans to "divest" any........if so, who ? if so, when ? if so, benefits to be derived ?
a)Yes we did divest UAC.....SA is now doing business in mainland China..It is smaller but should be turning a profit soon...
31. Are your personal plans still in place to leave at end of June ?
a)Yes, I originally plan to leave in June; but Hrct share price forces me to stay on, so I will until the situation gets better...Like I have stated in the past...I receive no salary or compensation ...I do this because of my commitment and loyalty to the shareholders; and because I have full faith in Hrct's success..
32. WHY does LexingtonPR........only have 2 customers ??? What is the
plan for them to expand and gain more visibility and credibility ??
a)They already have a big workload with hrcts companies.... They told me that it is still too early for them to expand......They want to do really well with Hrct first..
33. Based on past couple of days (ie. website hacking) do you plan to explore / determine if there was any criminal intent behind it ??
a)This would be costly to investigate;To involve the law enforcement, you need proof and that is a hard task........We participate in a class action suit against the naked shorting, organized by the famous lawyer in Texas, Quinn...He has many companies involved.....
34. What is the revenue / profitability outlook for Q2/02 ??
a)I'm not sure of exact numbers.......Hrct and her subs are growing and continue to grow....We have been adjusting our expenditures and are cutting back in every conceivable way to attain our goal of profitability....
