ARKONA CEO and Chairman Issues Optomistic Letter to Shareholders
SALT LAKE CITY--June 4, 2002--The following letter was issued June 4, 2002 by ARKONA Inc. (OTC: ARKN):Dear Shareholder,
I joined ARKONA Inc. (then called Sundog Technologies Inc.) as the President and Chairman in January 2000. At that time, stocks of Internet and information technology companies with no or little revenue were selling for hundreds of dollars per share and, in order to become a part of the Internet boom, ARKONA was developing both a database migration product and a secure email product through its Qui Vive Technologies subsidiary.
Many of you became ARKONA shareholders during that time believing that ARKONA could experience explosive growth within the information technology bubble. I joined ARKONA based upon my belief in such growth possibilities. As we all know, the bubble has burst, and many of the Internet and information technology companies formed during that time are bankrupt, limping along or have been sold at firesale prices. During the period leading up to and immediately following the bubble break, ARKONA's management had to face some realities regarding the market -- or absence of market -- for ARKONA's technologies and make some difficult decisions to sell or abandon the lines of business that brought me and many of you to ARKONA.
Unlike many of its peers, however, ARKONA is still intact and, I believe, has a bright future. In late 2000, I introduced ARKONA to Richard Holland and his small startup company, Ensign Information Systems. Ensign was attempting to revolutionize the technology environment in which automobile dealers operated. Although in the infant stages of development, Ensign's back office software for automobile dealerships looked promising, and their target market clearly had a need that was not adequately being addressed. At that time, ARKONA had established a strong marketing and management team, while Ensign had strong technical and industry expertise. Neither had significant capital, but we believed that a combined ARKONA-Ensign entity could secure enough funding to prove the marketability of Ensign's dealer management product and possibly take advantage of some synergies between the Ensign product and ARKONA's data movement technology.
ARKONA completed the acquisition of Ensign in November of 2000 and began releasing automobile dealer management products under the name of ARKONA in the spring of 2001. We continue to operate the company with bootstrap funding, but we are poised to play a significant role in providing the automobile dealer industry with new technology and fresh business practices. Over the past year the market has responded, conclusively, that our products and business approach increases productivity and significantly reduces a dealer's cost of ownership.
With that background, I wish to thank those investors who believed in the management team and in our commitment to ARKONA, who put their capital and support behind the company and who have been patient and supportive in this transition period. Our business has continued to expand through this period of recession. As more automobile dealers become exposed to our dealership management software, we expect to continue to expand and hope to start increasing our rate of expansion.
ARKONA's management has focused on building a business, not managing the stock price. Our premise is that if we build a solid business based on industry acceptance of our products and profitability, the stock will take care of itself. As a result of that focus, the price of ARKONA's stock remains at a level that I believe does not reflect the value of ARKONA. I cannot predict the movements of ARKONA's stock in the future, and certainly do not predict the sort of rapid increase in value that was prevalent during the late 1990s. I do, however, believe that ARKONA's key product, management and staff, and business plan are solid and that persons investing in ARKONA at today's prices will be investing in a company that is poised for significant growth into the future.
As the Chairman and Chief Executive Officer of ARKONA, I encourage you to once again start looking at and following ARKONA. Our SEC filings are available at www.sec.gov. Our periodic press releases and other information about ARKONA's business are available at www.ARKONA.com. We invite you to review our SEC filings, visit our website and call Steve Russo, our Chief Financial Officer, directly at (801) 501-7110. We believe that you will be pleased with the new ARKONA that we are building.
Very truly yours,
Alan Rudd
CEO & Chairman
This letter contains forward-looking statements and personal opinion. Such forward-looking statements are based upon our current beliefs, understanding and assumptions that we believe are reasonable; nevertheless, numerous future events and other factors may cause actual future results to differ from those suggested in this letter. Such factors include, without limitation, the risk that our competitors may enhance their products, our products may not keep pace with the demands of our automobile dealers and that the demand for our product may otherwise decline in the future. We expressly disclaim any obligation to update or revise any forward-looking statements found herein to reflect any changes in company expectations or results or any change in events.