Many risk factors will impact the ability to profit through a license or compensatory shares. We believe that Licensees who build and own ET3 infrastructure along routes with high transportation demand are the most likely to profit. Licensees who have production capacities that are used to produce parts or components for any ET3 projects have potential to profit from the sale of their products to licensees building a ET3 line. Licensees who contract to provide services that earn shares will be more likely to profit if ET3 implementation occurs and is successful. If ET3 fails to be built and / or does not work as expected or live up to performance expectations, licensees and shareholders alike will have less or no profit potential. ET3 shares are not registered or publicly traded, we rely on an exemption from registration under SEC Rule 701, and all outstanding shares are restricted and cannot be publicly traded or marketed. We cannot guarantee that the private shares will become registered or publicly traded.
There are also political risks likely to impact the implementation of ET3. Governments are involved in competing transportation modes, and may refuse grant to or impede permitting and or ROW acquisitions and or crossings of roads or public lands.
Our focus in the use of compensatory shares is on producing assets leading to and supporting ET3 implementation. We see ET3 implementation as a new market for licensee assets (skills, IP, production capacities, etc.). Some contracted services include: building the various ET3 web sites; accounting services, legal services, engineering services, route planning and survey, marketing, writing, parts and component production and/or supply, etc. Most service contracts are focused on producing value assets for the company. As with most companies, our goal is to acquire assets at a cost less than the value. We believe this will tend to improve share book value but cannot be guaranteed. We cannot guarantee that the shares book value will translate into market value, even if the shares become registered and publicly traded.