Seeking Alpha
Long/short equity, growth
Profile| Send Message|
( followers)  

Gentleman:

In a recent Seeking Alpha article, Management Under Attack, I identified certain press releases where I feel that On Track Innovations (NASDAQ:OTIV) management has misled shareholders. In another article, Primed For A Hostile Takeover, I pointed out how shareholders defeated your attempt to increase the authorized shares of OTIV and, in my opinion, the company could not effectively defend its poison pill defense.

I am sure that you are well aware of shareholders' dissatisfaction with the current OTIV management team. This management team has never shown a profit in the company's 22 year history, and revenue growth has not been consistent. Two of your major shareholders, Marc Silk and Jerry Ivy, have 13D filings with the SEC. Commenting on my recent Seeking Alpha article, former OTIV shareholder and successful businessman Gonzalo ("GG") Pique said,

Had a big position in OTIV. Met with management at a trade show and saw what they had with their add-on NFC antenna. Listened to their Q conference about their future plans. Read how the UC Davis people love their system

Since I have done many global launches I figured this is the right technology with the wrong guys doing the launch and controlling the company.

Dumped 100% of OTIV at a small profit

At the upcoming annual meeting (sometime in late 2012), the Board of Directors will have to decide whether to stand Oded Bashan for reelection to his dual roles of Chairman of the Board and company CEO. In my opinion, the same shareholders who defeated the company's attempt to fund a poison pill package will not reelect Oded to this dual position, and the Board of Directors should actively seek his replacement.

In my opinion, here are some of the qualities that the new CEO must have:

1. He must be totally independent from current OTIV management -- someone from outside the company, and someone not "hand picked" by the Bashan family. And the company should not limit this person's credentials because he is not an Israeli Jew.

2. He must have a proven track record in management, sales and marketing, and leadership.

3. He must have qualities that the investment community respects.

4. He must have "free reign" to hire new management to assist him in the growth of the company, and authority to replace current non-productive management.

It's important for the OTIV Board of Directors to listen to the voices of unhappy shareholders, and in this spirit, I hope my fellow shareholders will add additional qualities (for the new CEO) to this article in the comment section below.

Ed Schwartz

Source: On Track Innovations (OTIV)-Open Letter To Board Of Directors