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Summit
Environmental is adding compatible remediation formulas to its FlameOutŪ Fire Suppression
Agent, which enables it to go beyond just putting out fires and into mold & odor
control, and toxic waste remediation
Chemicals
Chemical Distribution
(SEVT-OTC: BB)
Summit Environmental Corporation, Inc.
133 East Tyler Street
Longview, TX 75601
Phone: 800-522-7841
Keith Parker
Chairman and CEO
Interview conducted by:
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
November 3, 2005
BIO:
Keith Parker
Chairman and CEO
Keith Parker is a very accomplished athlete; was a four-sport letterman in high school and
had collegiate scholarships in football, basketball, and baseball. He achieved the
honorable rank of Eagle Scout at age thirteen. He also spent three years playing
professional football. Mr. Parker began his professional career in finance and tax
planning and earned numerous industry awards and built one of East Texas largest insurance
brokerage and financial planning firms. In 1994 a chance meeting with a noted scientist,
Dr. Mohsen Amiran, led to the creation of Summit Environmental and the purchase of patent
rights to Dr. Amiran’s new fire technology in April 1998. Since that time, he has
dedicated his life to showing the world an entire line of environmental products whose
benefits are completely environmentally friendly.
Mr. Parker is a graduate of Texas A&M University
where he majored in both political science and behavioral psychology. He continued his
pursuit of higher education at Southern Methodist University and Southwest Texas State
University with graduate studies in tax law, estate planning and philosophy.
Company Profile:
Summit Environmental Corporations, Inc. (OTCBB: SEVT) a publicly held company based in
Longview, Texas markets and distributes biodegradable, non-toxic chemical products and
fire suppression agents in which the patent and intellectual property rights are held by
Summit. These products are manufactured under contracts for blending and packaging at
various locations at the direction of Summit. The most notable of Summit’s product
line, FlameOutŪ is the revolutionary new spot fire, aerosol can fire extinguisher for
residential use.
Founded by Chairman and CEO Keith Parker, the goal of
Summit Environmental is to aid in reducing environmental poisoning mainly in the areas of
fire fighting, because the heretofore use of toxic agents in this cause can result in
serious chemical pollution. The FlameOut product has been proven effective while being
easy to use, environmentally sound and providing consumers with affordable safety and
security. The company is committed to creating products to aid in reducing environmental
poisoning.
CEOCFO: Mr. Parker, what was your vision when you first
acquired your technology?
Mr. Parker: “Initially, I saw a product that could
revolutionize firefighting, as it was known at the time, because this chemical had
properties that addressed all aspects of the fire. By that, I mean the fire triangle,
which is oxygen, the fuel source and heat source. Every product manufactured in the fire
suppression industry –other than ours-- only addresses suppressing of the fire by
removing oxygen. This is the first chemical ever developed that significantly reduces heat
while it encapsulates and emulsifies the fuel source preventing re-ignition. When I saw
this, my mind began to dream about things that could be done to save lives and property. I
did not know where I was going to go because I did not have a firefighting background. In
my opinion, at that time, it was revolutionary.
I began on this trek after meeting Dr. Mohsen Amiran, who has a doctorate in physical
organic chemistry. Later, I acquired the patents and intellectual property rights for our
company. The road we traveled became much more complicated than I envisioned. The goal was
two-fold: one was to take our chemical, develop a litany of certifications for one
chemical never accomplished before, accepted industry, environmental and application
standards and toxicity ratings, both international and U.S accepted ratings for the
chemical. There are over a dozen that we have accomplished for just one chemical to apply
to all types of fires whether they are Class A, Class B or Class D fires. That goal has
been accomplished beyond my expectations with some of the things that have occurred in the
last 18 months.”
CEOCFO: Where are you
today?
Mr. Parker: “Today we have achieved all of these goals.
A culmination of these goals occurred when we were approved by the U.S. Forest Service for
inclusion on its 5100 307 schedule for wild land, wildfire fire suppression. The listing
completed a series for all five non-toxic ratings performed by evaluation laboratories
providing acceptable findings. These ratings gave us what we needed to apply to the
Government Services Administration for approval and to receive a federal supply contract,
which we now have.
Today, we are adding formulas that we own that are
compatible with FlameOutŪ, doings things like odor remediation, toxic waste remediation
and mold control. We are currently involved in a remediation effort at the Arena at the
New Orleans SuperDome. Again, that is why I say where we have ended up with this chemical
is far beyond just putting out fires!”
CEOCFO: Can you tell us
how your chemical is packaged and sold?
Mr. Parker: “One of the things I wanted to accomplish in
my initial goals was to take our chemical, put it in an aerosol can, get it rated as a
fire extinguisher - something that has never been done before. In 2003, our chemical had
an initial market test on QVC as an aerosol fire extinguisher under the brand name
FirePower™. By January of 2005 when we started regular monthly programming on QVC, we
began selling out every show. We sell 10,000-13,000 cans in six to eight minute
airings. That provided us credibility for the product to be sold and accepted on a mass
basis. In 2004, we began dealing with some people that had the capabilities to take us
into retail environment in a big way with the credibility for our technology established
by QVC. We developed our second aerosol can fire extinguisher, called FlameOutŪ. It is
just another name; another color and we introduced it into Big Five Sporting Goods on July
4th weekend of this year. Today we are in Target, Brooks/Eckerd Pharmacies, CVS
Pharmacies and several other retailing companies such as Sports Chalet. We are completing
display programs currently for Albertson’s Food Stores, Wal-Mart Stores, Inc., the
Kmart Company, Bed, Bath & Beyond, Kitchen Collection for fourth quarter 2005 and some
other major retailers that will open in early 2006.
We have an effective group of sales reps that are calling on every major retailer in the
country. This group that we have become associated with is very effective with what they
are doing. The gentleman heading the group, Gary Bishop, is the managing general partner
of Noble Mountain Tree Farm. His family has sold Noble Fir Christmas Trees to every
major retailer in the country since the 1940s. They definitely have the network
capabilities to call on all the buyers.
FlameOutŪ is now the standard for portable fire
extinguishers as recognized by the National Fire Protection Association as standard NFPA
10. In an aerosol can, we have the only product in the world that has successfully
satisfied the portable fire extinguisher ratings and received the validated listing mark
that is required by state fire marshal offices in order to validate a product as a fire
extinguisher.”
CEOCFO: Do most
households have fire extinguishers, and can you tell us how does the market appear for
fire extinguishers?
Mr. Parker: “Statistics show that less than 10 percent
of American homes have fire extinguishers. This is the opinion of a well-respected
firefighting professional, Steve Hauck, who currently serves as the fire chief of the
Yellowstone Club in Big Sky, Montana, a very exclusive residential community. It is his
opinion that even with the 10 percent figure that probably half of those are not charged
and if someone had to use them, they would not work.”
CEOCFO: How will people
notice the product?
Mr. Parker: “Steinreich Communications is the consultant
that we have retained to introduce FlameOutŪ through a nationwide media campaign.
There have been numerous news articles in San Diego, Los Angeles, Reno, Sacramento,
Chicago, Denver, New York, Miami, Washington D.C. and the product has been featured in USA
TODAY. We have been on several morning news programs demonstrating the product so people
can see FlameOutŪ work. We typically prepare a turkey-roasting pan with wood, paper, rags
and accelerant. We ignite the fire and use a typical extinguisher that people would see
that sprays powder. We put the fire out and re-ignite it, put it out and re-ignite it
again. One of the real fears for someone trying to put out a small spot fire in their home
is re-ignition. We then prepare the same duplicate setting in another pan, start the fire,
use FlameOutŪ to put out the fire and in the same manner with the same device attempt to
re-ignite it --and it will not re-ignite. That is visual and it makes a lasting
impression. The same presentation concept is currently being prepared in a
television promotion that we hope to have on the air within the next 60 days.
Once somebody buys this product and uses it, the word-of-mouth will drive people to
purchase and it can be incredible. I say that because when we first aired on QVC, they
complete what is called their test-market. They give you up to three shows and you have to
produce a predetermined sales dollar amount per minute. Meeting their criteria allows you
to go on to the next level. By the second two shows in 2004, we sold out. When you are in
a test market, callers will call in and be asked why they purchased the particular
product. With our product they might respond by saying something like, “I thought it
would be a good idea because my mom lives alone.” After we started regular
programming and aired the first show in January, a caller gave a story beginning with her
purchase of our product back in 2004. She told of her son working on his car in the
garage. The car caught on fire. He grabbed the can of FlameOutŪ and put the fire out so
fast that she exclaimed, ‘The fire didn’t even harm the car.’ With that
statement made, there were over sold 2,000 additional cans sold even after “SOLD OUT”
flashed across the screen. Every show on QVC is selling out now. All shows have previous
customers calling with similar stories with different settings. They remark about how fast
the fire is extinguished and the ease of clean up where all they have to do is take a wet
rag or towel and wipe, leaving no residue. We get these same type of calls frequently in
our office.”
CEOCFO: Do you
manufacture the product yourself?
Mr. Parker: “Dr. Mohsen Amiran, an environmental chemist
from whom we purchased the patents, formulas and intellectual property rights, has a
manufacturing laboratory, BioGenesis. They manufacture all of our chemical concentrates.
We utilize a contract aerosol filler, Custom Aerosol Packaging. They receive our empty
shells, purchase our actuators, valves and caps. They blend our chemical into finished
product, fill the cans, provide the propellant and package according to each customer’s
particular requirements. Advanced preparations involve our purchasing the empty shells up
to 250,000 at a time for each aerosol product. We have them shipped to a warehouse a few
miles away. Our warehouse conducts the final steps completing our shipping requirements.
Everything is electronic, meaning you do not get paper purchase orders anymore. There are
third-party electronic data companies that act on behalf of these big retailers.
They send you a purchase order and we send the purchase order to the custom filler.”
CEOCFO: Will you tell us
about the financial picture?
Mr. Parker: “We had been frugal while we were developing
Summit. We used private placements, initially to raise capital and public shares. We have
an excellent securities attorney that has provided great benefits, services and counsel.
Our initial set-up established our ability to sell shares through private placement
memorandums directly from the company. Our goal was to experience as much minimum dilution
as possible. We wanted to save the additional expense that would be experienced from IPO
fees and the additional issue of shares. Currently we have 24 million shares outstanding.
Once we saw the success of QVC and the interest began
to escalate from leading traditional retailers, I began searching through one of our
associates obtaining receivables financing for our purchase orders. Today, we have a $25
million line of credit for accounts receivable financing. We have already utilized this
vehicle on some of the orders received and it has worked beautifully.
When I sit back and reflect on our early success, I
relish the relationships with experienced and dedicated professionals who have helped us
at each point along the way.
We have been blessed with the contacts, these
business professionals in all areas. These are individuals such as Stan Steinreich, in the
area of public relations and advertising, Gordon Lewis, in finance, and Gary Bishop, in
marketing, through the Noble Mountain Tree Farm Network. There is also Robert Heggie, a
partner in AmBiz Associates LLC. They are all quality, successful people that we have been
able to attract in our network because of FlameOutŪ and its incredible properties.”
CEOCFO: In closing, what
should investors know and why should they be interested now?
Mr. Parker: “Our two initial goals were to establish a
niche with an aerosol can that nobody else had accomplished, and establishing the ratings,
certifications and validations unique in the industry for all types of fire that we have
received for one chemical. They are now well established. Our aerosol technology is
experiencing sales surpassing what we expected. We anticipate from just the aerosols
themselves, doing about a million to a million-and-a half in sales this year. We have gone
from a development stage company at the end of the 4th Quarter of last year and
into a full marketing company beginning the 1st Quarter, attaining that level
of sales. What is intriguing to potential investors is that you can expand this chemical,
its ability to cool and its ability to neutralize fuels, by our being able to add a
remediation formula, an odor control product or a mold control product, put them in
FlameOutŪ and new state-of-the-art systems that are out there for dispersing chemicals
like ours. We went to New Orleans with the idea of expanding what we knew would work and
it has been met with great acceptance. The product is eliminating odors in a few minutes
and eradicating bacteria and toxic waste. It is a profitable venture for our company. From
September 26 to October 11, for example, our first project generated $450,000 in sales
revenue cleaning one site in New Orleans.
We were able to get our GSA scheduled for FlameOutŪ expanded and approved within three
days because of the emergency in New Orleans. We are not yet able to define what this
really means to us because we just completed the first decontamination project of this
magnitude. The environmental problems that exist: mold is everywhere, the sanitation
issues, bacteria, can be successfully remediated by using FlameOutŪ as a carrying agent
dispensed through what is called a compressed air foam system. Mixing our other chemicals:
Ultimate Odor Control, Ultimate Mold/Fungus Control and Ultimate Clean 850 BioEnhancer
that are compatible with our FlameOutŪ to use as the carrier, it is producing incredible
results.
There are other niche markets. In the logging
industry, there are major insurance companies that require FlameOutŪ to be on the very
expensive logging equipment. We have an indirect endorsement. Fire insurance
coverage for new bound coverage or renewal coverage requires ‘FlameOutŪ or a product
like FlameOutŪ in order to have coverage extended. When you couple FlameOutŪ’s US
EPA SNAP Listing, UL Class A and B, US Forest Service, ABS Maritime, Mammalian, Aquatic,
Dermal, Oral and Eyewash Non-Toxicity ratings, H-M-I-S rating of 0-0-0-B and certified
rapidly biodegradable, there is no other product like FlameOutŪ. This is a niche market
and our product performs beyond anything they expect. The individual pieces of equipment
operate all day and are hot. They are exposed to all the components for spontaneous
ignition and our product addresses the fires like that very quickly. We see that as we
advance, that with the concept and effectiveness of FlameOutŪ, that we are going to be
able to penetrate niche markets where property insurance will be an issue. FlameOutŪ
extinguishes all types of fires faster and with less water than any other product ever
manufactured. This fact can reduce the damage caused to property due to its fast acting
capabilities. One of the features about FlameOutŪ and our aerosol can fire extinguishers
is that an individual’s homeowner’s insurance policies will allow 5 percent
discounts if there is a fire extinguisher in the home. It is a question on the policy
application and it does not say what type of extinguisher. That discount received can pay
for the extinguishers needed in the home.”
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