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Technology Stocks : TAVA Technologies (TAVA-NASDAQ)

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To: Josef Svejk who wrote (14481)	4/9/1998 7:06:00 AM
From: Mr Logic	Read Replies (1) of 31646

Re the cash position: the company fixed the problem last year, as reported. It was fixed at some cost to shareholders - warrants etc. so they can raise more cash by issuing more authorised shares. The only real risk is increased dilution, devaluing the individual shareholding. The filings "do not anticipate significant Y2K revenue before the third quarter" (March quarter) so the implication is that if Q3 y2k revenues are not very good, more dilution may occur. There is also $2m repayable in June that they need to be in shape for. Essentially, management has taken a risk on financing - if Y2K revenues ramp up quickly they will be fine. If not so quick they will probably need to dilute. The providers of financing last year have done very well so far and it would be surprising if they do not try to take advantage of the stock price and lock in some of their substantial gain. They must get the core business and the payables position sorted out as well to avoid cash pressures. As I say, if they do all this, there is not a problem but it does put increased pressure on them to deliver. P.

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