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Redwood Scientific Technologies, Inc.
Stockholder's Letter
Published Sep 28 2011
5 min read

Stockholder's Letter

CONTACT INFORMATION: Ray Wyman Jr, Communications Dir EMAIL: ray@coolnsave.com OFFICE: 714-892-0011 

 Stockholder’s Letter 

September 28, 2011 

Huntington Beach, CA 

Dear Fellow Stockholders: 

As I write this letter, I am looking at the trophy that was awarded to us this June for our work on the Cool-n-Save system; an accomplishment that we believe is recognition for our work in “green engineering.” We were interviewed repeatedly by engineers from Harvey Mudd College, one of the leading engineering schools in the country. To be honest, we were the long shot: the smallest company among all finalists armed with an unusual solution for the thorny problem of excessive energy consumption of air conditioning. 

To give you some additional perspective, our competitors were Fisker Automotive, makers of the headline grabbing luxury electric sports cars, and Amonix, Inc., the leading designer and builder of large scale photovoltaic solar power plants. 

When we arrived at the awards ceremony (still, with no idea that we had won), one of the judges broke away from his stoic persona and said, “This is so simple, it’s stupid.” 

Since 2005, I’ve heard that remark at least three times: from an investor, a customer, and now this engineer from Harvey Mudd. One of these days, I’m going to have that remark engraved in stone, because it speaks to both the advantage and disadvantage of the Cool-n-Save concept. 

As you know, Cool-n-Save is an energy conservation innovation that uses evaporation to pre-cool air and reduces HVAC energy consumption by as much as 30%. But for some folks – no matter how many times we’ve proved it, no matter how many engineers endorse it, no matter how many case studies we offer – they still treat Cool-n-Save like snake oil. 

Yet, we have managed to sell more than 16,000 residential systems and more than 200 commercial systems – with little or no paid advertising support. I’m very happy to report that we recorded a 370% increase in sales of our commercial systems over last year. All present sales activity is driven by word-of-mouth and press coverage. 

(continued) CONTACT INFORMATION: Ray Wyman Jr, Communications Dir EMAIL: ray@coolnsave.com OFFICE: 714-892-0011 

At the same time, residential sales dropped about 20% from last year. This drop is due to three possible factors: 1) commercial sales are more profitable, so faced with limited marketing resources we decided to push that sector; 2) the economy has definitely had a negative effect on residential sales; and 3) as other analysts have reported, we do not have funding we need for a comprehensive marketing campaign. 

In September 2009, our company divested certain assets and we focused our business on our Cool-n-Save business. At that time we had completed nearly all of our R&D goals and we had a what we believed to be market-ready product. 

We are surprised by the extent of the unusual recent daily trading volumes recorded for our Company’s Common Stock. We are not certain what may have caused these increased trading levels but we are certain that since January 1, 2011 to the present date, the Company’s officers and directors have not undertaken any public re-sale of their stockholdings. 

While we cannot be certain what may have caused the increased trading volume, we can speculate that it may have been due to short sellers who needed to cover their trading positions. At the same time, we do know that none of our officers or directors have purchased or sold any shares of the Company’s Common Stock during this period and we have not engaged the services of any external investor or public relations firm. 

We do know that the Company’s Common Stock, similar to the common stock of other small public companies that trade on the OTC Market, trades on a limited and sporadic basis and there can be no assurance that any continuous and liquid trading market will develop or, if it does develop, that it will be sustained. We anticipate that if market conditions allow our share price may regain value. 

The Company’s core activities have never been stronger. Three patents support our marketing activities: Cool Release chemical water treatment, the Cool-n-Save residential paddle, and the “HERO” High Efficiency water treatment system. 

I urge that all of our stockholders carefully evaluate the risks and disclosures that we publish on OTCmarkets.com. These reports and others that are publicly available should be reviewed to ensure that an investor purchases our common stock that they are able to make an informed investment decision. 

(Continued) CONTACT INFORMATION: Ray Wyman Jr, Communications Dir EMAIL: ray@coolnsave.com OFFICE: 714-892-0011 

We are a small public company and we fully appreciate that trading in our common stock can be subject to many factors that are clearly beyond our control. And, given the economic and financial market uncertainties, it is difficult to know what variables influence the market price of our common stock, the trading volume in our common stock, or other related matters. 

In that light, we feel that it is a mistake to view any stock volatility as an indication of company’s health. We continue to work on behalf of our customers and our investors. Our primary interest is to build our brand, sell our products, and to make this company as profitable as possible. 

Thank you, 

BEN LEFRANCOIS CEO, Greenway Design Group, Inc. 

Cool-n-Save is manufactured and marketed in the U.S.A. For more information about Greenway Design Group, Inc. and Cool-n-Save, call 714-892-0011 or visit www.coolnsave.com and www.greenwaydesigns.com. 


FORWARD-LOOKING STATEMENTS 

THIS DOCUMENT CONTAINS “FORWARD-LOOKING STATEMENTS.” FORWARD-LOOKING STATEMENTS ARE STATEMENTS CONCERNING PLANS, OBJECTIVES, GOALS, STRATEGIES, EXPECTATIONS, INTENTIONS, PROJECTIONS, DEVELOPMENTS, FUTURE EVENTS, OR PERFORMANCE, UNDERLYING (EXPRESSED OR IMPLIED) ASSUMPTIONS AND OTHER STATEMENTS THAT ARE OTHER THAN HISTORICAL FACTS. THESE FORWARD-LOOKING STATEMENTS ARE ONLY PREDICTIONS. NO ASSURANCES CAN BE GIVEN THAT SUCH PREDICTIONS WILL PROVE CORRECT. ACTUAL EVENTS OR RESULTS MAY DIFFER MATERIALLY. FORWARD-LOOKING STATEMENTS SHOULD BE READ IN LIGHT OF THE CAUTIONARY STATEMENTS AND RISKS THAT INCLUDE, BUT ARE NOT LIMITED TO, THE RISKS ASSOCIATED WITH A SMALL COMPANY, OUR COMPARATIVELY LIMITED FINANCIAL AND MANAGERIAL RESOURCES, OUR INABILITY TO MARKET AND SELL OUR LIMITED PRODUCT LINE IN SUFFICIENT VOLUMES THAT MAY ALLOW US TO ACHIEVE AND MAINTAIN PROFITABILITY AND POSITIVE CASH FLOW, THE UNCERTAINTY OF MARKET TRENDS, THE INTENSE COMPETITION FACED FROM OTHER CURRENT AND FUTURE TECHNOLOGIES AND THE UNCERTAINTIES OF COMPETITIVE PRESSURES WE FACE. THESE OR OTHER RISKS COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THE FUTURE RESULTS INDICATED OR IMPLIED IN SUCH FORWARD-LOOKING STATEMENTS. WE UNDERTAKE NO OBLIGATION TO UPDATE OR REVISE SUCH STATEMENTS.