IATV - ACTV Interactive Television Message Board

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Microcap & Penny Stocks : IATV - ACTV Interactive Television

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To: art slott who wrote (532)	9/9/1997 9:22:00 PM
From: men mailman	of 4748

I may have jumped too fast to a conclusion in my posy # 499, and would ask everyone to DISREGARD it for now, until I do more due dilligince. I have discussed the issue with an analyst and we came to the following reasoning. Granted that the preffered diluted the common heavily, at the current price the worst is behind us. The reason being a) That since you have a TANGIBLE net BOOK VALUE (mainly cash) of about 75 cents per fully diluted share (with a 20 million share outstanding as an arbitrary number), this will definitely be a HUGE support level for the stock at the worst case scenario. b) The higher the difference between the stock price and the "FIXED" conversion clause of the preffered (1 1/8 which is the august average price). the more money they make. If the stock is at $1 and they convert at 70 cents they make a sure 30 cents, however if the stock is at $2 and they convert for the fixed 1 1/8 they make 87.5 cents. c) It is therefore that they have no rush to convert any time soon especially with pending news of the TEXAS market, which if successful can give the stock a legitimate $3-4 stock price or higher. d) In the meantime they collect divedend of 5% and have no risk, since if the stock goes lower they will aleays be able to get a 30% discount at the going price. e) It is far less riskier when the stock is at $2 and they convert for 1 1/8. Since they are required by law to first convert and then sell they face far less risk that the stock should decline below the conversion price which would be a drop of 7/8, than the 30 cents drop at the $1 level f) EVEN IF WE WERE TO TAKE THE WORST CASE SCENARIO THAT THEY CONVERT AT 50 CENTS LEAVING 27-28 MILLION SHARES THE STOCK WILL STILL BE OVER $3-4 ONCE THE tEXAS PHASE GETS UNDERWAY. 1) lAST YEAR WITH 11 MILL. SHARE THE STOCK TRADED 3-4 OR A MARKET CAP OF 36MM -44M.(BEFORE ANY INTRODUCTION TO ANY MARKET) SO AT 26 MILL. SHARES, YOU DEFINITELY HAVE A $1.6-1.8 VALUE PER SHARE PLUS !0 MIL IN CASH FROM THE PREFFERED OFERING AND MAINLY THE REALIZATION OF ITS NEW INTRODUCTION IN TEXAS 2) Once there will be net earnings of 3-5 million dollars the market cap willl definitely be worth 10-15x earnings or 50 - 75million with a a $3-4 dollar per share value. g) In light of the above the stock may not go too much lower than here. AS to the insider selling that I mentioned it probably was a mistake in understanding an edgar filing of aug.96 page which includes a list of the selling parties. As to the 25 mil placement, it seems the company will only be looking for $3 million at this point and should probably get it without any substantial dilution to shareholders. I understand that annoncemments about fina\ncing and the startup in TEXAS will be in the first week of OCT. (the srart up equipment was already ordered). The thing that ticked me off in the morning was that I did not get a straight answe too my question and concerns of dilution from the company. In conclusion I would request again that you disregard my prior post until I do more research, And if you are comfotable with management than the preffered issue may not have that much bearing at the current price levels.

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