MEMORANDUM
To: Clean Technology International Corporation Shareholders
Date: July 31,2008
The Board of Directors of CTIC met following the Shareholders meeting on June 28,2008. The Board decided that sending a quarterly shareholder report would be desirable. This is the initial report. Attached are copies of the minutes of the shareholder meeting and the Board of Directors meeting.
Some of the more important issues discussed at the Board meeting included the addition of two new directors to the Board. The Board's review of CTIC's By-Laws provides that the Board can elect these new directors for a term to end at the next annual Shareholder meeting. The Board intends to move forward finding new directors. If you have a shareholder or other person you believe would be a suitable person for a Board position please advise in writing as soon as possible. It is the Board's intent to complete this selection as soon as reasonably possible.
We are pleased to report that a contract has been signed with EADS. Unfortunately, this process was signifcantly delayed by the unapproved actions of a former member of management. Without apparently verifying with management the true ramifications of his actions a contract was sent to EABS earlier that did not protect CTfC's interest, Apparently an amended version of an existing and acceptable CTIC agreement was used. The amended version did not contain the required vital protection for future use of CTIC nano materials. Upon learning of this agreement it was recalled. CTIC is now in a position to receive the benefits of any derived invention resulting from the relationship with EADS. We welcomes any input regarding potential users of our products and processes.
The Board has decided to investigate obtaining a value for the company's patents so it can be added to the balance sheet. The price for such an evaluation may approach $100,000. The Board will weigh the benefits of having some third party independent evaluation as compared to a value being arbitrarily assigned to the patents. Management 'believes that the technology is very valuable, however until it is valued independently we have not attached my value on the balance sheet.
We have been in the process of investigating the loss of a fairly large amount of the Company's nano product and accompanying effort to duplicate, those products while trying to conceal those efforts. This investigation has been ongoing since early 2008. Some of the consultants employed by CTIC in the manufacturing process were threatened when they discovered that an effort was underway to try and take over CTIC by removing valuable and necessary data equipment used in monitoring the manufacturing process as well as by removing the data, The significance of the data can be established by observing that the data would be used to try and duplicate the work of CTIC's Technology Officer by combining it with an attempt to reverse engineer CTIC's process. We have recently learned that a posting on a new website has begun to try and discredit the science created by our Technical Officer as demonstrated in the issued and pending patents in the U.S. and Europe. The combination of the events once again emphasizes the absolute necessity of maintaining a position of protecting our technology from those who are now seeking to obtain our fifteen plus years of research, development and testing unlawfully. As we continues its investigation we will reveal as much as we can without jeopardizing our technology. We intend to be as aggressive as possible in pursing these matters.
MINUTES OF SHAREHOLDER MEETING OF CLEAN TECHNOLOGY INTERNATIONAL CORPORATION
HELD JUNE 28,2008
PLANET HOLLYWOOD HOTEL & CASINO
LAS VEGAS, NEVADA
At 8:00 A.M. on June 28, 2008 the annual Shareholder Meeting of Clean Technology International Corporation was called to order. W. Darrell Lainhart announced that the company's Board of Directors had appointed him to act as Chairman of the meeting. Thereafter the following meeting was conducted.
The Secretary announced that there was a quorum of the shreholders present and the meeting could commence. Present were Directors Irene M. Lainhart, Anthony Wagner, Marvin Lainhart and Dr. David Kemp. Dr. Kemp gave the invocation for the meeting.
The Chairman of the meeting announced the next order of business was the election of two directors. Director jim Carroll has submitted his resignation as a director and the term of Marvin Lainhart is expiring. Management recommended that Marvin Lainhart be elected for an additional termand that Darrell Lainhart be elected for a term. These individuals were elected by acclamation.
The Chariman next reviewed the efforts of the company to abtain contracts within the U.S. government as well as businesses in the U.S. and in Europe.
The status of the machine built in Houston was reviewed and reported that is was not operational. The licensee could not continue as it was not making the progress desired and decided to end the project.
The Chairman noted that there had been some significant interest in the value of the company's patents. An insurance company has been contacted for purposes of reviewing to determine if such a valuation is feasible and affordable. The company has been issued patents in the U.S. and Europe as well as having pending applications in both the U.S. and Europe.
The next order of business was a review of a recnet trip by the Chairman and the Chief Science Officer to Europe to visit with clients who are involved in using nano material of the quality of CTIC's material. The Chairman reported that he and Mr. Wagner felt like the trip was a success. The persons going and the trip paid for the trip personally. It was emphasized that on at least four occasions the Company had some non-disclosure agreements that were sent to some of these same customers that were not satisfactory nor did they protect the Company. New agreements have been sent for signing. The protection of the patents and the product was discussed and the importance of maintaining the crucial confidential nature of these matters.
The next order of business was consideration of ratifying the acts of the officers and directors from the last shareholder meeting until the present. Five shareholders present voted against the motion. The remaining shareholders constituting more than fifty percent of the authorized and issued shares voted for the motion and it carried ratifying the acts of the officers and directors from the last shareholders meeting to the present.
At the request of a shareholder the Chairman discussed the possibility of company "going public." There is no time line for going public. Going public is driven by the Company's ability to get contracts such as with Airbus and Spinmelt. The Company cannot promise that it will go public only that the Company is interested in seeking that goal.
The next order of business was for shareholders present to make comments concerning the company. There were several negative statements concerning management and the share disribution among the shareholders and questions concerning information about the company. The Chairman noted that the questions would be discussed at the Board of Directors meeting.
Julia Butler, Secretary
MINUTES OF THE MEETING
OF THE BOARD OF DIRECTORS OF
CLEAN TECHNOLOGY INTERNATIONAL CORPORATION
JUNE 28, 2008
The scheduled meeting of the Board of Directors was called to order at the Planet Hollywood Hotel and Casino, Las Vegas, Nevada. All Directors were present for the meeting. The first order of business was the election of officers. Marvin Lainhart moved to re-elect the same officers for the following year or until their successors are elected. Tony Wagner seconded the motion. A discussion followed and the motion was amended by motion of Marvin Lainhart and seconded by Tony Wagner to elect William D. Lainhart as President and Julia Butler as Secretary. The motion carried unanimously.
The company's financial affairs were then discussed. Approximately $100,000 was reported by the president to be in the Company's present cash position. It was also discussed that the Company was indebted to Dr. Kemp. The remaining amount due would be made in installments as it had in the past.
Next followed a discussion concerning the smaller machine located in Houston. The issue is whether or not to reclaim the machine. Shareholder Bob Black has expressed an interest in building a new machine for CTIC at a suitable location. At the request of the Board Dr. Stu Dinwiddie, a consultant for CTIC reported that the machine had been sabotaged so that all of the data connections had been removed thereby causing a loss of the quality control and verification processes. Also, there had been dangerous events where the Chief Operating Officer had violated known safety standards and endangered some persons working around the machine. This matter will be studied further for possible action.
The ongoing events in Germany and Switzerland were discussed including the preparation of a new Non Disclosure Agreement that would protect the unauthorized use of CTIC products for purposes of derived inventions.
The Board next discussed the comments by the shareholders. The Board then duly approved several items including the addition of two new directors, requesting the company's accounting firm prepare some financial statements, issuing a shareholder report quarterly or sooner if necessary and pursuing a valuation of the patents if financially prudent to do so.
With not further business to come before the Board the meeting was adjourned.
Julia Butler, Secretary
General Category