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  Transcripts of Wall Street Reporter Interview with Essam Zaghloul

November 10, 2000
 
 
  WSR> Good day, this is Tan Panaker, Senior Analyst Wall Street Reporter Magazine. Today we have with us Mr. Essam Zaghloul. Mr. Essam Zaghloul is the Chairman, President and Chief Executive Officer of Clarity Telecom Networking Incorporated and also the President and COO or the Chief Operating Officer of NTG Clarity Corporation, NTG International Incorporated. Clarity Telecom Networking Incorporated is traded in the CDNX, ticker symbol CTW.

Essam welcome to our show today.

EZ> Thank you very much Tan, I am pleased to be here.

WSR> Thank you so much for joining us today. Essam lets start, I understand your company is headquartered in Calgary, Alberta. Lets start with this note, that you have been generating significant interest in the markets recently. Lets start with the overview of your company.

EZ> NTG Clarity was established in 1992 in Markham, Ontario to deliver focused network and infrastructure solutions to telecommunication service providers.

We now have a team of approximately 200 employees in offices in Toronto, Montreal, Calgary, Vancouver and Cairo, Egypt.

We are an established, profitable company with an excellent reputation in the telecom field as a company that does it right the first time.

Clarity Telecom is a CPC (Capital Pool Company) in Alberta listed on the CDNX. Its major transaction or the Reverse Take Over is NTG International.

WSR> OK, now you have, Essam, strategically focused your company on the telecommunications sector. Why is this sector so particularly attractive?

EZ> The telco sector is attractive to us Tan for several reasons. The Telco market has experienced phenomenal growth since deregulation in 1997. In Canada the current telco market is $23B (IDC).

In Canada there are 19 CLECs and 22 more have been proposed.

In the USA spending on telecom services has increased from $116B in 1999 to $237B in 2003. This is about 10 times the Canadian market - and there are hundreds of US CLECs!

Finally, with this phenomenal growth there is an acute shortage of services and products that are tailored for the telecom market. So there is a particular shortage of qualified telecom professionals with experience in building competitive telecom networks - and that's where we fit in.

WSR> Now, Essam NTG Clarity's list of clients is quite impressive. You've obviously already established a strong presence in your field. What sets your company's offering apart from the competition today?

EZ> Our clients as you know Tan are tier one Telecom companies including AT&T, Bell Intrigna, Group Telecom, C1, Rogers, and others.

Our business model is unique where our services provide revenue to finance our product development and acquisitions. One of the things that clearly separates us from our competitors is our understanding of the challenges faced by CLECs and ILECs today.

Established, uh, we also have established strategic relationships with our clients. We provide a full-service approach to our clients - from planning through to implementation. We have proprietary and innovative products.

An experienced visionary leadership and the ability to attract and retain qualified technical staff through a challenging career and ownership in the company. Also through our family name and connections we have the ability to raise financing.

WSR> Now Essam, you definitely have aggressive and exciting expansion plans for the company. Can you give our audience an overview of the key milestones you have planned for the next year or so.

EZ> Our key milestones Tan are: to acquire 3 companies by year end 2000, these are in final negotiations and legal contracts. We are planning to be listed on the TSE by end of Q1 2001. We plan to open 3 regional US offices by the end of 2001. We plan a major acquisition by mid 2001, and possible NASDAQ listing by Q2 2002 and our first international office by Q1 2002.

While these may appear to be aggressive, we are very confident that they are all achievable and we have done so in our previous companies Wi-LAN and Cell-Loc.

WSR> Now can you give us an idea of the kind of growth NTG Clarity has been experiencing recently.

EZ> NTG Clarity has had phenomenal financial and employee growth over the last few years. In 1997 we had revenues of $0.5 MM and in 1999 we had revenues of $3 MM - a growth rate of 600%. To date we have revenues of $5.5MM and if we continue at the same pace we should realize revenues of $8 to $9 MM by year end 2000.

Our forecasted growth rate is a conservative 75% per year. We anticipate revenues around $15MM in 2001 without acquisitions.

Demand for our services is so high that we have tripled the size of our workforce this year. We started the year with 65 people and today we are now approaching 200.

We expect these trends will continue - NTG Clarity is in an excellent position to remain as a leader in the telecom services and products space.

WSR> Now Essam, you are currently developing a series of software applications for the telecom industry. What differentiates these applications from others on the market and when do you expect to complete development?

EZ> Let me just start with that we have several applications nearing completion Tan: The first one is the Order Tracking system. Another one is Configuration, Asset Management & Provisioning. The third is a POP Build System. And the fourth product is an Integrated Telecom System. We estimate completion of these products by 2001.

What differentiates us really and sets us as a leader is that our programmers are telco engineers and they also work with programmers so they are very experienced and truly understand the nature of CLEC businesses. We can develop a superior product that meets our client's needs better than others on the market.

The revenue opportunities for these types of applications are enormous - The global market for Operational Support Systems will be $38 B by 2002 (Insight Group).

WSR> Now you are in the process of acquisitions and alliances I think it appears to be an important aspect of NTG Clarity's growth strategy. What has been, and will be, the strategy in terms of, you know, jumpstarting NTG Clarity's global market penetration?

EZ> Yes, acquisitions will play an important role in our expansion plans, particularly as we enter the US arena. We have recently acquired a cable and fibre installation company, a private company by the name of Net-Comm Communications. Net-Comm complements our ability to offer full-service solutions, particular in the area of co-locate and POP site builds.

We are in the process of finalizing details with 3 smaller companies which are in the areas of training, wireless and product development.

We also look for companies with an established clientele base and a strong management team - this will help us expand our global presence much faster. And with the current rate of change in the telecom industry, we need to be able to enter global markets quickly!

WSR> Now Essam, there has been enormous market excitement surrounding NTG Clarity and Clarity on the CDNX recently. Can you give us, in other words our audience, some insight on what has happened and why investors are so interested in your company.

EZ> Clarity Telecom shares started trading on October 11, as a Capital Pool Company in Alberta. With the news that NTG International would be the proposed Qualifying Transaction, i.e. the reverse takeover, the share price skyrocketed.

We opened at 30 cents and closed at $2.70 the first day of trading. We've consistently traded above that point since then.

Well what do investors see in us?

Number one, a growing market. Number two, strong financial resources to fuel our expansion - we have no debt. Leadership team that has been involved in leading other successful public companies (Wi-LAN & Cell-LOC that both trade on the TSE) We have a strong revenue momentum - 1000% from 97 to Oct 2000. An experienced team focused on solving our client's technology and implementation issues. And the ability of our investor's to participate in a ground floor opportunity.

WSR> Established and reputable management team and advisory board? could you enlighten the audience on their background and your background also and what kind of expertise do you bring to Clarity today?

EZ> Absolutely, our senior managers have over 350 years of telecom experience, many with experience leading emerging competitive telecom companies.

Our Board of Directors is first class, coming from executives in AT&T, an ex-executive of Rogers, the CEO of Wi-LAN and an ex-oil company executive, so it is a well rounded board that brings a lot to the table.

My personal experience, I am an oil executive, and I had over 30 years experience in the markets, I have been an executive in bringing and managing giant projects.

And we've put a strategic Advisory Board together. That strategic Advisory Board includes key people from the telco industry and includes executives that have worked for Nortel and some of the vendors.

WSR> Essam, can you give our audience the web address and the investor relations telephone number for further information and research about Clarity Telecom Networking.

EZ> Absolutely, We have actually two websites, one is www.ntgi.net and the other one is www.claritytelecom.ab.ca. The telephone number is (403) 261-0968, fax (403) 261-0970, email ezaghloul@ntgi.net

WSR> Essam, it's been a pleasure chatting with you today and learning about NTG International and Clarity Telecom. Thank you so much for such an enlightened conversation.

EZ> It is my pleasure and thank you so much for inviting me Tan.

WSR> Thanks so much. This is Mr. Essam Zaghloul, Chairman, President and Chief Executive Officer of Clarity Telecom Networking Incorporated and also the President and Chief Operating Officer of NTG International Incorporated. Clarity Telecom Networking Incorporated is traded in the CDNX, ticker symbol CTW headquartered in Calgary, Alberta.

This is Tan Panaker bringing you the news on Clarity Telecom and NTG International Inc., thank you so much and you have a nice day.

   
 
 
  
 
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