Roger's 1998 Short Picks Message Board

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Strategies & Market Trends : Roger's 1998 Short Picks

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To: Bill Wexler who wrote (8761)	5/14/1998 1:28:00 AM
From: CalculatedRisk	Read Replies (3) of 18691

All: ZITL. The ZIT 10-Q has been filed and it is UGLY. The next round of financing is imminent ... IMO, this dog will be trading below $5 soon. Here is the filing: edgar-online.com A few nuggets: Line of Credit: In the February SEC filing, ZIT wrote: "The Company is in the process of completing an agreement pursuant to the commitment offer letter, which was executed on February 5, 1998, for a $3.0 million secured line of credit." In this filing, the actual line of credit was for only $1.5 million! The bankers wouldn't even loan ZIT $3.0 million ... secured. Divesture of Storage Division: The Company is evaluating a number of alternative actions; however, there is no assurance that the divestiture can be completed without incurring significant costs. IMO, Storage will be shut down, not sold. New Financing: The Company currently plans to raise additional capital to fund operations until cash flow from operating activities are positive. Management is actively engaged in evaluating alternative sources for capital and believes this effort will be successful. IMO, the new financing will be another round of highly dilutive "death spiral" convertible debentures. Regards, Bill

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