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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG)

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To: neverenough who wrote (909)	6/1/1998 11:22:00 PM
From: JEFF BERRY	Read Replies (3) of 44908

Nigel, Thanks for your post.......You make mention that Mr. Gordon has put up $5 mill of his own money. I assume you are referring to the revolving credit note signed in April as referenced in the 10q. While the money could very well be there and available to tsig to help satify short term liquidity needs, it is by no means guaranteed to be there. Mr. Gordon has not parted with 5 mill of his own money. The note specifically states that the borrower may not be indebted in aggregate by more then 1 million at any given time. It also says that Mr. Gordon at his sole discretion may choose to veto any draws that the corp. may deem neccessary to make. Additionally, the note allows Mr. Gordon the option of converting any indebtedness incurred under the loan at any time into tsig shares at .15 a share.......Nigel,when I examined the note in detail I became suspicious of the nature of the transaction.....While Mr Gordon could be the knight in shining that will rescue tsig from cash starvation, it is also possible that Mr Gordon does not of 5 mill left to his name and the note is nothing more then a ploy to provide security to investors who may have tanked the stock when the 10q was released with the absence of short term cash plan........According to their filings tsig is pusuing a business combination or roll up. In speaking with Bill Kabesh last friday he indicated that a private placement that has been rumored was either delayed or derailed. He indicated that his discussions with Mr Gordon centered on a 200 million roll-up as the hope for tsig's bright future. If such a roll-up were to ever occur the value of tsig stock would determine the percentage of the new roll-up company that tsig investors would own. With management holding a sizable number of outstanding shares they can not afford to see the stock tank during these discussions. Would maintaining stock price stability be in the best interest of the rest of tsig shareholders as well?.....Perhaps, if such a roll-up were to actually come to fruition over the next few months.....(In my opinion unlikely since transactions of this size involving multiple companies rarely go as smoothly and quickly as contemplated.) However, the foregoing renders the 5 mill note as nothing more then window dressing. In fact it could even viewed as a stock option for Mr. Gordon. under the terms of the note he can choose to to loan money at his own discretion and then choose to convert the indebtedness into shares at .15 a share.(potentially illegal under sec laws).....Thus even if my bearish suspicions are off target I am still concerned with the nature of the transaction that provides Mr Gordon with all the beneficial options to be excercised at his discretion at any time to acquire stock at .15 that is being purchased by everyone else at nearly three times his option. No doubt he is in a better position to value the stock then you or I.....After reviewing the terms of the note it would seem that if someone were truly bullish on tsig there best bet would be to contact the company direct and loan money to the corp under the same terms as Mr Gordon then convert the indebtedness into .15 shares.........Respectfully, JAB

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