In 1901, Ivan Pavlov, a brilliant Russian physiologist (he was later a Nobel Prize winner) published a seminal paper on what is now called “conditioned reflexes”. It was based on his laboratory work in St Petersburg, Russia. He noticed a normal reflex, dogs salivating before being fed, could be reproduced by other phenomena - in this case the bells of a local church near his laboratory. So the dogs would salivate at the sound of the bells even though not fed. It is a biological and physiological classic and widely taught now.

What, might you say, is this to do with POET? Well, I can demonstrate from this forum that if the words "reverse splits" are mentioned, then a significant group of investors will always produce negative responses using words such as "hammer blows" or "sledgehammers". Others respond by demonstrating evidence of the success of a reverse split on later share price. Thus, some writers are negative and some are positive. I argue that this behaviour is akin to Pavlov's Dogs or to repeat the derived adjective: the response is pavlovian.

I state all this to make a plea that what is being asked by the board, and to be voted on, is to give authority to use the facility of a reverse split if needs be. There is simply no evidence that it means the company is failing in some way which seems the consensus of the negatives here. More convincing and, in all probability, it is a convenient mechanism to raise the share price to a level that allows access to one of the tiers of the NASDAQ. I ask you all to read Bumblebees unreservedly excellent posts for why this is a useful ambition for the board of directors.

Share Consolidation - Clarifying Some Misconceptions

Re: NASDAQ listing requirements

Re: Pellegrino II - Timely Disclosure & NASDAQ

Re: OTCBB vs. Nasdaq - Answers

The technology offered by POET is not easily appreciated and, to do so fully, requires considerable knowledge of semiconductors: how they work, the limitation of Silicon and the advantages of III-V semiconductor materials. What all must appreciate is the technology provides a sudden and exceptionally large leap in computing speed, at significantly lower power demand, much more cheaply and combined with an ability to produce memory banks, read and produce light at a series of wave lengths including light, infra red and ultraviolet inputs and outputs. This has profound implications in a huge (around $450 billion) semiconductor market. All this is done on a single chip which Silicon just cannot do because it is at its limits of development where development costs of research and production outweigh advantages. A grasp of these facts means POET is likely to be the paradigm shift claimed in phrases such as "ground breaking technology" etc. If you can stand a technical paper by Geoffrey Taylor to reassure yourselves read Lucky Gal's post of 23 July

- http://www.compoundsemiconductor.net/article/94567-gaas-the-logical-successor-to-cmos.html?utm_source=twitterfeed&utm_medium=twitter

Just understand the potential is huge and there is no serious competitor at this point in time.

If you are invested in this company then you have no choice but to trust management to turn this into a company with huge potential and revenues. The board is faced with some substantial challenges currently and its behaviour to date strongly suggests "it knows what it is doing". The share price is irrelevant and it’s not the job of the company to keep it high at all costs.Their job is to monetise this brilliant idea, if you think you can do better than them you should sell.To suggest that a reverse split must be a mistake just cannot be right. Please don't behave like the hounds of Pavlov at the word reverse split, read more widely.

Finally, it is evident from some posts, that there is financial over commitment and an unnatural insistence on instant gratification, thus, considerable angst at recent share prices and complaints at management to increase the share price. This clearly influences statements on this forum in a negative way. I have lots of shares but if it all went "belly-up" I would be very disappointed but not destitute or bankrupt. Never, put all your money on one share if you are not prepared to lose it all.

I leave you with a conundrum. If you grumble about the SP, the RS the poor management why on earth haven't you sold already and left the forum after 3+ years of this hell – for God’s sake save your money at all costs; or, is it, deep down, in those recesses of the mind, where no-one else goes, you really suspect it may be spectacularly successful but your glass is only at the midway mark and this forces you to inflict repetitive nonsense on others.If the decision on a reverse split is a sledgehammer blow where’s the insider selling?Why is the appointment of a leading semiconductor industrialist, with a huge personal network, a hugely successful background in technological advance joining a small failing company after being offered 2 million useless options which he knows are about to undergo a reverse spilt and a sledgehammer is about to strike them?If you really mean this is such a blow why haven’t you sold because you are foolish not to if you believe this, or have you another motive.Just a teeny–weeny smidgen of illogicality here I suspect.Oh! By the way, do tell us if there are, just possibly, some advantages to a RS. All who think this way, do try and be sensible and then you won’t be accused of negativity.I’m not a management acolyte or psychophant (I think they are pretty smart actually), just acutely aware there is no other alternative than selling.

David