Page 80 - Gary's Book - Final Copy 7.9.2017_Active

chapter S corporation, with twelve employees doing $2.5M per year. With sales
fluctuating greatly, it was just barely breaking even. It was chicken today and
feathers tomorrow. [Chuckle, chuckle!]

I started in September 1985 as sales and marketing director and left in August 1995
as the president/CEO.

We developed new products such as conference bridges, calling bridges, automatic
call distributors, automated operators and voice mail systems, which opened global
markets with new applications and did not limit the company to only telephone
company (Telco) needs. The first major launch was showcasing various
conferencing bridges allowing one-on-one, up to 48 people in the same bridge. At
a profit of $15M the first year, the commercial market was reasonably successful,

but the newly developed “976” business was being established in Japan. These
were primarily gay and lesbian talk lines and heterosexual porn conversations that
were generating massive growth. Callers were charged $3 to $30 per minute. The
Telcos (AT&T, Bell, Verizon, and Sprint) allowed the bridges to be installed at
customer sites but did not participate directly in the business. Telephonic

Equipment Corporation was now not just in “line cards” for central offices or
business on-site phone systems; it was penetrating the global market. With some
contacts in California and a promotional campaign, I could identify key prospects
in Japan first - then across the USA and Europe. The first year we sold $6M; the
second year we sold $12M and eventually leveled off at about $15M per year.
Employment grew to about 65 to 75 employees with a lot of overtime. I made
several trips to Japan and Germany. With the business being coordinated in Los

Angeles, my long travel trips were greatly reduced. I later convinced the board to
change the company name to TEC International, which was more representative of
our new business.

As you would expect, business of this nature attracts shady characters and the
underworld. Within two years, we had major law suits against us, and we would

issue counter law suits. Securing attorneys that could go across state lines and
overseas to Japan and South Korea cost some major dollars and time, which
diverted the attention of the company management team. We spent over $500,000
on legal fees. We did win a $9M lawsuit in Tokyo but never collected a single
dollar of it.

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