US Securities and Exchange Commission
Washington, DC 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 7, 1997
CONECTISYS CORPORATION
(Exact name of registrant as specified in its charter)
Colorado 2-33-3560D 84-1017107
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
7260 SPIGNO PLACE
AGUA DULCE, CALIFORNIA 91350
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (805) 268-0305
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Form 8-K: Dated: April 3, 1996
CONECTISYS CORPORATION
Commission File # 33-3560D
Item 5 - Other Events
SEC LAWSUIT
REBUTTAL
Over the past ten months the Company has voluntarily
cooperated with the Securities and Exchange Commission ("SEC") in
its investigation of alleged misconduct in the trading of the its
stock by a particular broker dealer. In February 1997, the SEC
filed an amended lawsuit which added the Company as a defendant.
This action by the SEC came without warning and with no chance
for rebuttal or explanation by the Company. Given the good
relationship that the Company had established with the SEC.
However, due to the unilateral actions taken by the SEC, the
Company is ready, willing, and able to bring the SEC allegations
in front of a Judge as early as May of this year. It is the
Company's desire that it may answer the SEC lawsuit as soon as
possible. The allegations made by the SEC have no basis in fact.
The SEC has acted with recklessness and knowingly abused its
power in an egregious manner. The Company expects to be fully
exonerated of these allegations and the SEC will be held
accountable for its misconduct. The Company will accept nothing
less than an order exonerating the Company of any alleged
wrongful acts. If the SEC can act immediately, the SEC may
prevent a future lawsuit brought by the Company and its
shareholders. It is the Company's desire to have a quick and
speedy trial. It is prepared and ready to defend itself without
delay in this matter.
The President and Chief Executive Officer Robert A. Spigno
has said he would like the Shareholders to know, "[t]hat the
Company has committed no wrongful acts of any kind" and "[t]hat
the Company intends to fight this wrongful lawsuit to its
inevitable conclusion which I predict will end with the SEC in
full retreat, concluding with nothing less than a written order
exonerating the Company of any wrongful doings."
By: CONECTISYS CORPORATION
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Conectisys
The State of the Company
Conectisys Corporation -- Consolidated Progress Report
First Quarter 1997
Conectisys is trading on the NASDAQ OTC Bulletin Board under
the symbol CNES. In the last 19 months the Company's current
management unwound its relationship with its former subsidiary
Creative Image Products and acquired two new subsidiaries,
PrimeLink Inc. and TechniLink Technology Manufacturing Inc., both
hi-tech companies.
Conectisys is currently negotiating on behalf of its
subsidiary PrimeLink for several material contracts with the
likes of Wilwire Inc., a subsidiary of Williams Natural Gas
Corp.(WMB) trading on the New York Stock Exchange, Coca- Cola,
Transdata Corp., Enogex Inc., all except Enogex have purchase
products and are working on successful pilots. Enogex will be
leasing the product. Conectisys is proceeding with negotiations
for future releases of the Primelink products.
Conectisys with its subsidiary PrimeLink is working under a
Joint Marketing Agreement with SkyTel Inc. Where clients such as
Williams Natural Gas, Coca Cola and Transdata Corporation among
others, who have helped make the Telemetry market that Conectisys
enjoys today.
Currently Conectisys has contracted verbally the Gateway
Agreement with Wilwire Inc., said contract has been drafted and
is to be signed this month. The Company feels strong about this
project, do to the fact that we are currently working with
purchase orders for the Gateway, and have received payment for
the on going work. More importantly Wilwire has sold the
PrimeLink product to several large commercial clients.
The President of PrimeLink, Donald I. Wallace, in a report
to Conectisys said that, "delivery of the Primelink Telemetry
products is set for mid May."
On February 20 of this year, Mr. Wallace,filed with the United States
Patent Office for a patent on its Telemetry line of products. The current
status is patent pending.
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Conectisys and its subsidiary Technilink, are currently
negotiating with the Exxon, Conoco, Shell and Honeywell
corporations.
Currently the Technilink's engineering staff are processing
a test site at Exxon Baytown, a petrochemical plant in Texas,
where a pilot test will take place in the next several months.
The President of Technilink Karl E. Elliott in a recent report to
Conectisys said that, "the purchase order will be issued in the
early part of the second quarter" and that "Honeywell has agreed
to test the product on behalf of Exxon and are prepared to
recommend the technology as well as are preparing a Joint
Marketing and Licensing Agreement, a draft of which is currently
being prepared as noted in a letter from Honeywell to
Technilink."
PrimeLink's -- Progress Report
First Quarter 1997
Achievements
The Company has developed three wireless monitoring products
and data delivery services.
All three products (TransComm, VIM and FloComm) have been
purchased and successfully operated in pilot tests with Coca-Cola
and Williams.
The data delivery service (PrimeXpress) has been selected by
Enogex and will be under contract by the end of May.
Williams Natural Gas has selected PrimeLink as the equipment
supplier for a pipeline Automated Meter Reading (AMR) project,
which will start installation in July this year.
The Coca-Cola Company selected and approved our technology
for their vending machine monitoring.
We have established an alliance with one of the largest
energy companies (The Williams Companies) in the nation. This
assures us of participation in the fast growing AMR market
sector: commercial/industrial aggregated retail gas and
electricity sales. The agreement is expected to be entered into
in the month of April.
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We have developed and implemented a marketing strategy which
provides a low-cost entry into the commercial/industrial energy
retail market (teamed with Williams) and direct sales to smaller
energy producers, vending machine operators and bulk chemical
manufacturers.
Management believes these achievements place the Company in
a unique position to benefit from a continuous increase in
profitable sales starting in 1997.
Marketing Summary
The energy AMR market, which is very new, has become
somewhat clearer over the short 19 month life of PrimeLink.
Primelink has made entry and penetration into the first level of
segmentation which is the commercial/industrial and residential
utility markets. All players in the market have intended to
target the residential customers because of its shear size,
however, the commercial/industrial markets have emerged (in our
view) as the market with greater short term potential.
Many states already have laws in place that allow users to
choose their energy supplier rather than just accept the local
distribution company's service. The intended benefit is of
course a lower purchase price to the user. In order to realize
this benefit, however, users must aggregate their demand from
multiple locations (often in many different cities across the
nation) in order to bargain with suppliers. Using this leverage,
a user can then approach a supplier and reasonably expect to get
a discount for volume purchases.
The challenge to the energy supplier is to arrange metering
of the supplied energy at many locations across the nation. The
local distribution company is not likely to cooperate and allow
use of its meter, because it is in direct competition with the
aggregator, so new meters must be added and a national meter
reading scheme is required, hence AMR.
We believe the need for energy suppliers to respond to the
new business model created by deregulation provides a
significantly stronger need for AMR than simply cost savings. The
difficulties facing residential users to forming aggregation
groups means that this pressure does not yet exist in the
residential sector and it will therefore move at a slower pace.
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The residential projects that are in use today are being
driven primarily by the local distribution compan1ies with the
intention of using the AMR for meter reading, and as a gateway to
the home of the future. This approach requires a decision at the
highest levels to commit the company to communications in
addition to energy, and is therefore not one that is taken
lightly or universally. This means that this sector will develop
much more slowly than the commercial/industrial sector.
AMR Market Approach
PrimeLink has targeted the commercial/industrial market
sector due to the clear driving forces, i.e., the need for
energy suppliers to provide nationwide AMR systems in order to
make large retail energy sales.
During the last 19 months, two major energy companies have
emerged as energy (both gas and electricity) retailers: The
William's Companies and Enron Corporation. Both companies have
their roots in gas production and pipeline networks and both have
formed relationships which allow them to enter the electricity
retailing market.
As the principles of PrimeLink have existing relationships
with both companies, albeit much stronger relationships with
Williams, it was decided to target them as primary vehicles for
product sales. Through these relationships, sales should increase
dramatically during the third quarter of 1997.
We have operated under an informal alliance with Williams
for the last four months, and are in the process of completing an
agreement which will allow PrimeLink to market Williams' services
in addition to their proprietary products which are manufactured
by PrimeLink.
Not all potential applications are based on energy
deregulation. Companies that employ staff to read a meter for
service or invoicing purposes are potentially interested in
automating the process if it lowers costs and improves customer
service. These companies may buy our products and handle the
wireless service themselves or they may prefer a total service
approach.
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Technilink's -- Progress Report
First Quarter 1997
Achievements
The Company has developed the Cube 2001 product line. The
Cube 2001 is a process control device that monitors and controls
various pieces of equipment in the industrial automation
industry.
Technilink is currently negotiating with the Exxon, Conoco,
Shell and Honeywell corporations.
As part of its Cube 2001 product marketing, Technilink and
Honeywell have agreed in principle to jointly market a package of
control systems for the petrochemical industry.
Currently the Technilink's engineering staff are processing
a test site at Exxon Baytown, a petrochemical plant in Texas,
where a pilot test will take place in the near future.
Technilink expects a purchase order will be issued in the next
several weeks and that Honeywell has agreed to test the product
on behalf of Exxon and are prepared to recommend the technology
as well as are preparing a Joint Marketing and Licensing
Agreement, a draft of which is currently being prepared as noted
in a letter from Honeywell to Technilink.
Dated: April 3, 1997 /s/ Robert A. Spigno
ROBERT A. SPIGNO, President
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