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  • ecd_anonymous ecd_anonymous May 17, 2005 11:33 AM Flag

    Now if Stempel could do this for us...

    Raser came to life as a public corporation in October 2003 after its reverse
    merger with a shell company called Wasatch Web Advisors Inc. Moving ahead with
    its plans to develop its alternative electric motor, Raser ramped up spending
    in 2004 to about $6.8 million, from $750,000 in 2003. But most of that
    increased spending, $5.2 million to be exact, went to general and
    administrative spending like salaries and equity based compensation rather than
    the research and development one would have expected. For the first quarter of
    2005, Raser posted a net loss of $2.2 million and no revenue with a first
    quarter loss of 5 cents a share. Raser is in the early stage of developing its
    Symetron technology which it says can improve the efficiency of electric
    motors. The company plans to license its technology but so far has no contract.
    As of the end of March, Raser had netted only $30,000 in revenues with a net
    loss of almost $16 million.

    Despite Raser's unproven technology, the company's stock is currently trading
    at $21.20 a share, bringing Raser's market capitalization to about $1.04

    Raser's CFO Dwyer said that the company is in discussions to license its
    technology. "We're hopeful that we'll have licenses well before a year but
    that's about as much as I can say," he said.

    Like many development stage companies, Raser has made generous use of stock
    to finance itself. Most recently it raised $18.5 million by issuing Series C
    convertible preferred shares exchangeable into a minimum of 833,333 shares of
    common stock at an initial conversion price of $24 a share. These convertible
    shares are now registered with the SEC. That means that they can be converted
    and sold at any time which will dilute existing shares, potentially pressuring
    the stock price. Under the terms of the transaction, Series C convertible
    shares outstanding 60 days after their May 4 registration will be automatically
    converted into common stock "at the then-applicable conversion price."

    Meanwhile, despite a recent stumble in Raser's stock price, a number of the
    original investors in the company have made out quite well selling shares as
    they became free to trade.

    Perhaps perfectly illustrating the vicissitude of Raser's stock price, one
    very lucky shareholder named Kelly Trimble in January made a quick $125,000
    selling 7,500 shares he got just two months earlier as payment for a
    motorcycle. Reached by telephone in Salt Lake City and asked about the
    transaction, Trimble simply responded "it's really none of your business."
    (Those shares were worth about $43,500 on the day that the motorcycle changed

    (Carol S. Remond is an award-winning columnist and one of four who write
    the "In The Money" feature)

    -By Carol S. Remond; Dow Jones Newswires; 201 938 2074;

    (END) Dow Jones Newswires

    05-17-05 0731ET

    07:31 051705

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