Evercel (CE) (USOTC:EVRC)
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Evercel Issues Letter to Shareholders
HINGHAM, Mass., April 21 /PRNewswire-FirstCall/ -- Evercel, Inc. (EVRC.PK),
today released the following letter to shareholders from Chairman James Gerson
and CEO Garry Prime:
Dear Fellow Shareholders,
2003 has been a disappointing year. Our sales of nickel-zinc batteries have
been quite limited and we have incurred substantial losses. As a result we have
taken several steps to attempt to both preserve our assets and embrace
opportunities for future corporate value. The steps included a drastic
reduction in expenses, investment in an unrelated business, continued efforts
to exploit our nickel-zinc technology and exploration of other business
opportunities.
1. Expense reductions: We have reduced our payroll to one part-time
engineer and our rent expenses to nil. Virtually all our efforts are
being conducted by our officers and Chairman on a part-time,
uncompensated basis. In the U. S. we have moved to much smaller space
which we share with another company. In China our fixed overhead has
been substantially reduced and we run our production line only when
there is appropriate demand. Furthermore, we have withdrawn our
public registration of securities. Our securities are now traded
through the "Pink Sheets" and we no longer have the compliance and
filing expenses of an SEC publicly registered company. Nevertheless,
we plan to continue to obtain audited financial statements.
2. Investment in unrelated businesses: As previously reported we
invested $2.0 million in series C preferred shares of Zipcar, Inc., an
innovative and very rapidly growing, hourly car rental company. Zipcar
has operations in Boston, New York and Washington D.C. It is one of
the largest companies of its kind in the U.S., has significant
proprietary technology and is advancing a business model which is
already proven to be very successful in Europe. Zipcar's website is
http://www.zipcar.com/.
3. Continued efforts to exploit our nickel-zinc technology: Our
technology has proven itself to be a successful solution for several
electric vehicle manufacturers. Clearly, it has been very challenging
to get customers to design products using our technology given our
size and financial condition. Our largest customer, Oxygen SpA,
remains committed to our products and is projecting substantial orders
over the next several months. We intend to supply batteries for these
orders if economically appropriate. Our lease in Xiamen expires in
October, we have been able to negotiate a Letter of Intent (LOI) with
a very successful private building products manufacturer which is
supported by the local government and which may enable us to continue
manufacturing should we receive appropriate order flow. In general,
the LOI provides that our JV partner will provide $4.4 million for 44%
of the new company and we will provide $600,000, exclusive and non-
exclusive licensing in certain Far East countries and our know-how for
56% of the new company.
4. Exploration of other business opportunities: We are continuing our
dialogue with other battery manufacturers with a view to possible
combination of our efforts. In addition we are entertaining other
proposals from non-battery manufacturers. All of these discussions are
very preliminary at this point. Since our liquid financial condition
is very limited our expectation is that with a qualified opportunity
we will raise additional financing if required.
We expect to have our audited financial results by the end of May and we will
then make them available to our shareholders.
Needless to say it is not pleasant to report our current lack of success. We
can assure you, however, that we had and continue to have a very dedicated,
creative and loyal group of employees. On behalf of all our shareholders we
would like to thank them for their efforts.
In addition we assure you that we intend to remain dedicated to the
preservation and enhancing of Evercel and its technology.
James Gerson., Chairman
Garry Prime, CEO & President
April 21, 2004
DATASOURCE: Evercel, Inc.
CONTACT: Investor - Anthony Kiernan of Evercel, +1-781-741-8800; or
Media - Bill Baker of Baker Communications Group, LLC, +1-860-350-9100, for
Evercel