Oh, man. This is a classic. Everyone has to read the Form 10. It's a
laugh riot. Some choice cuts:
We have entered in agreements to provide services to underserved,
underdeveloped or developing countries. The table below provides a number for
the location of each circuit. For competitive purposes, we are not disclosing
the city, country or general location. All circuits will be installed in
underdeveloped or developing countries which we believe are underserved. The
table also explains the date of one operational circuit, and the expected date
of operation for the other circuits.
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1 June 1999
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2 September 1999
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3 September 1999
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4 October 1999
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5 October 1999
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6 October 1999
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7 October 1999
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8 November 1999
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9 November 1999
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10 November 1999
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11 December 1999
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12 December 1999
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Wow, a list of numbers and dates. The 'competition' must be scared
stiff.
Currently we have one customer
for our existing circuit but are negotiating with three other customers.
Many of the countries where
we conduct business do not have judicial systems that provide the protection
from or expeditious resolution to certain unlawful actions which may be taken
against our company or our Local Partner and, as a result, our business may be
materially adversely affected. For example, at the end of the third quarter of
1998 the Company experienced an interruption in its primary circuit to a foreign
country and its equipment was confiscated. The Company believes that the act of
the foreign country was illegal and is pursuing the return of its equipment and
the restoration of its circuit. As a result of the confiscation, the Company
estimates that it lost approximately $3,000,000 in revenues in 1998.
They snuck this nugget in a 'for example' and I almost read right
past it. The entire company was shut down from Q3'98 (BEFORE
Cyberfast went public!) to June '99. Why? My guess is they were
running a (locally illegal) "call back" operation and got
'busted'.
Because we had no revenues from November 1998 [i.e. since we went public] until June 1999, we have
a working capital deficit. Our principal stockholders have provided loans since
June 30, 1999 of $380,000. Until our operations provide positive cash flow, we
will require additional working capital loans.
NO REVENUE. This is what liar Stackpole said on June 29: Mr.
Edward Stackpole, chairman and chief executive officer of the
Company, said, "I am delighted to issue our first annual earnings
release based upon audited financial statements. With all of the
rumors presumably being circulated by short sellers or others wishing
to manipulate our stock price downward, the audited net income
reflects what we have been contending. Our core business is very
profitable. With our expanded management team represented by a recent
addition of Sprint personel, I am confident we can roll out our
business strategy."
Because of the number of shares and voting power attributed to the Class B
Common Stock, the Stackpoles control 75.5% of the total voting power and are
able to control the election of the Company's directors and thereby control the
policies and operations of the Company.
Pursuant to employment agreements with the Company's key management
personnel, the Company is obligated to pay an aggregate of 16.6% of its
quarterly net pre-tax income to these persons in addition to their base salaries
and stock options. There is no adjustment provision in the event the Company has
a unprofitable quarter following a profitable quarter. This can have a material
adverse effect on the Company's future results of operations.
WHAT!!! I've NEVER seen anything remotely like this. Even by the
standdards of scummy nanocap BB stocks, this is a new low.
ABSENCE OF INDEPENDENT DIRECTORS
Cyberfast's Board of Directors consist of Edward and Itir Stackpole,
who are its principal shareholders and husband and wife, and Mr. Stackpole's
brother. Additionally, by contract Cyberfast has agreed to use its best efforts
to appoint Alan Goldstein, its Chief Operating Officer, and Bert Perez, its
Chief Technical Officer, to its board of directors. Even if Messrs. Goldstein
and Perez are appointed, Cyberfast will have no independent directors.
No surprise there. It's a Stackpole family business.
4,934,802 OF OUR TOTAL OUTSTANDING SHARES ARE RESTRICTED FROM IMMEDIATE RESALE
BUT MAY BE PUBLICLY SOLD IN THE NEAR FUTURE. THIS COULD CAUSE THE MARKET PRICE
OF OUR COMMON STOCK TO DROP SIGNIFICANTLY, EVEN IF OUR BUSINESS IS DOING WELL
We currently have outstanding 1,520,450 shares of Class A Common Stock
and 4,540,050 shares of Class B Common Stock. Our shares of Class B Common Stock
convert on a share-for-share basis into shares of Class A Common Stock at the
option of the holders. Of these outstanding shares, 1,020,698 shares are not
restricted and may be resold in the public market although the 4,755,500 shares
held by our principal shareholders are required to be sold under Rule 144 of the
Securities Act of 1933 which limits the amount of shares that can be sold at any
time. The remaining outstanding shares are restricted and may be sold under Rule
144. Once this registration statement becomes effective, no sales of the
Company's Class A Common Stock
may be made under Rule 144 for a period of 90 days. On the 91st day following
the effective date, Rule 144 will again become available.
As restrictions on resale end, the market price could drop
significantly if the holders of these restricted shares sell them or are
perceived by the market as intending to sell them.
Mark your calendars...
To be continued... |
