Who is MotoSAT?

O&G: Who is MotoSAT?
Mr. Pendleton: MotoSAT is an engineering management group that has always been a leader in the development of automatic satellite systems. Our approach and solution to finding the location of a satellite is unique and has kept us on the leading edge of the Mobile technology industry. The MotoSAT engineering technology goes back over 25 years to the days of the C-band satellite era. In the beginning, we developed systems to track the 22 different satellites used in C-band technology. We then moved into the High End RV market using a 5 foot antenna mounted on top of half million dollar RV’s of the late 1980’s and into the million dollar RV’s of the middle 90’s. Today the DBS 18 inch dish has arrived, this technology has since evolved into the High Speed Internet market of today.

MotoSAT has developed and marketed Mobile satellite antenna platforms under the MotoSAT name since 1985 when it developed the 5 foot and later the 18 inch DBS systems. In January of 1999, I acquired the MotoSAT Division from the parent Company for stock and pay out of my retirement incentive program. I had faith in the technology that the parent company did not have. In 2002 MotoSAT introduced the first .74 Meter mobile two-way Internet system despite the fact that at this time the then HughesNet management said it could not be done. After showing the .74 Meter system at the January 2002 CES (Consumer Electronic Show) HughesNet signed up under an exclusive development contract with MotoSAT and the system went to market under an agreement that it was tied to the HughesNet platform for the first two years.

From 1999 until today, with little investment, the company has developed an unbelievable number of technologies that have led it to be a leader in the field of mobile satellite technology. Though relatively unknown even today, it has grown from a $2m per year to a $20m per year company. Its expected growth in the next few years should be extremely accelerated in addition the market is also growing in large percentages, especially after the September 11th and Hurricane Katrina tragedies in the U.S. Oil pricing is another area for large growth because in the past many of these areas relied on fixed satellites which were being move from site to site, now they are being upgraded to one button fully automatic mobile satellite systems at tremendous cost savings to the drilling companies that need their data sent from one on site rig and quickly passed from one location to another.

O&G: What products does MotoSAT manufacturer and how do those products relate to the oil field environment?

Mr. Pendleton: MotoSAT technology is second to none in its ability to perform and function in adverse conditions and circumstances. From +120F degrees to -60F degrees and operating in up to 60 mph winds, the MotoSAT products are already in many areas of the Globe. Since the late 1970’s the MotoSAT technology has continued to survive and improve until in today’s world it is a leading technology.

MotoSAT products are positioned from a mid-level to high price point concentrating on high performance and reliability. MotoSAT’s goal has always been to provide the customer with the finest product backed by top quality service. MotoSAT products fall into four (4) categories: Mobile Internet; In-motion TV; Stationary TV; Control systems and Accessories. The MotoSAT primary business has evolved into the following categories Mobile Internet solutions for Oil and Gas exploration, Emergency government and business needs and to provide primary and back-up communications in data, voice and video.

Present Internet products are .74 meter, .98 meter and 1.2 meter two-way (transmit and receive) one button auto pointing satellite Internet systems. We also manufacture a full line of TV receive only systems from single LNB pop-up, Multi LNB, Skewable pop-ups and full In-motion TV systems

O&G: Why is the DataStorm the right fit for Russia, Europe, Asia and the rest of the World?

Mr. Pendleton: As major Oil and Gas companies continue to drill for new sources of petroleum in unpopulated areas of the world, one of the most needed technologies is communications. The only real way to communicate is via two-way satellite. This gives the company an instant way of communication with only tenths of seconds delay. Through this medium you can have data, video and voice communication in a very secure manner. In addition, normally the cost to move a fixed system from location to location is extraordinarily high because the company sends a technician out every time the system moves or has a problem and it is expensive. Many drilling site are in areas of heavy weather and rough terrain and system damage is a concern. Now with the MotoSAT DataStorm system these problems are minimized and the cost reduction is also tremendous. The DataStorm is designed to work anywhere in the world automatically with a two button operation, “Search” and “Stow”. When moved to a new location on a tool pushers shed or trailer, you just push “search” and the system automatically goes up and finds the proper satellite and automatically aligns itself to be able to transmit and receive the signal. If a major storm comes up that could cause damage to the system or the wind blows the system off satellite, then all that has to be done is push “stow” and after the storm push “search”. If the satellite is blown off signal then push “Search” again and the system will re-peak back on satellite.

O&G: With the turmoil of countries and conflicts who hold natural resources, what is MotoSAT’s plan to penetrate and effectively sell communications products like the DataStorm?

Mr. Pendleton: MotoSAT is designed to work anywhere in the world using DVB technology. We can supply the system and the associated bandwidth, VoIP (voice) and furnish a complete ready to use (turnkey) package or in areas where we are not able to sell the complete package because of restrictions, we can sell just the system and the customer can find a local source for the associated bandwidth service and accessories. Therefore there should be no conflict with any countries and no impact to our commitment to supply the customer with as much of the product and service as we can, while following all the laws and rules that apply in each country.

OG: What are your future plans for growth and are these plans relevant to the future of oil as a natural resource?

Mr. Pendleton: MotoSAT’s main products at this time are the XF2 .98 meter and the XF3 1.2 meter systems. Over the last year we have started offering the services and accessories that go along with the system. These include several service providers such as HughesNet, iDirect and LinkStar who are on various satellites throughout the world. Our DataStorm D3 controller offers our latest and what we feel to be the superior technology in finding the requested satellite and locking onto the signal. Our proprietary software can work with all manufacture’s satellite modems which are used to communicate with various satellites.

The MotoSAT technology started with the early C-band technology in the late 1970’s to early 80’s when our same engineering and management team developed the first automatic positioner to find and locate the 22 C-band satellites used in the those days. The finding and locating software has been continually improved upon since that time up to today. We believe it is the most advanced pointing software available. We will continue to improve and update the software as new technologies come to the market. We intend to produce over the next one to two years, a new line of very heavy duty mounts all fully Ka-band compatible ranging from a .74 meter all the way up to 1.8 meter they will all have the very latest software and electronic technology available.

One major area of growth in the past two years and continuing into the future is our ability to manufacture our entire product line in our own facility. At our facility we now manufacture our entire system from the raw aluminum plate, milled to the finished parts, making our own gears, designing, tooling and molding our own plastic parts and designing and populating our own printed circuit boards, which means we are very vertically integrated in our manufacturing ability. This allows us to control our costs, do just-in-time manufacturing and make needed changes in the shortest turnaround time.

Our largest customers to date are in the Oil and Gas business. We have been learning the needs and requirements of this environment and the type of systems needed. We have made many improvements to adjust for the Oil and Gas environment and doing this has improved the DataStorm for all applications, both industry and government. We will continue to look for ways to improve the product and you will also see some significant improvements in pointing technology coming over the next year or two.

MotoSAT has approximately 7000 two-way Internet systems, and 20,000 TV systems deployed to date, we continue to deploy at the rate of over 4000 TV and Internet systems a year and are on track to be at the rate of 6000 systems by the end of the third quarter 2007. Our manufacturing capability for growth at present is over 10,000 systems a year and can be expanded as necessary. We certainly would like to have the opportunity of providing our service to Oil and Gas customers.