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Strategies & Market Trends : Cheap China Play---GTTIF
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To: DOUGLAS C. SMITH who wrote (26)2/13/1997 8:31:00 AM
From: Albert Shilin   of 42
 
In my understanding, this news is very important for GTTIF.

1. They made a stock swap and will make $20 million+ profit. It is a very good profit and make the book value much higher.

2. Bought back $10 Million its 8% senior convertible subordinated debentures and will record a one-time gain of $6.3 million in the coming quarter. That is $0.32 per share. They still have $20 debentures left. Note that these debentures are convertible into common shares at a conversion price of $12 per share up to maturity on July 31, 2003. It means that the company believes the stock price could be up higher in the future.

3. The Court dealing with the class action lawsuits against the company as a result of the actions of previous management has designated January 1998 as the hearing date for the trial. I think that it means that the last lawsuits could be settled in early next year. I read the news on August 16, 1995 again and find the following words:

"The class action suits against the Company pose potential consequences that are very serious, both in terms of the onging costs of defense and the potential liability faced by the Company if the lawsuits are successful. Unless the actions can be settled on a reasonable basis, which appears unlikely at present, the uncertainty caused by these lawsuits will continue UNTIL THE MATTERS ARE DEALT WITH AT TRIAL. Our counsel has advised that a trial before 1997 is unlikely."

Now the trial is schedualed and there would be no lawsuits to this company next year.

Now, all we have to see is what is going on for the business in China. I believe that it is the easy part for them since the telecommunication market in China is very hot and huge right now. They have made a lot of deals already.

This stock is under-followed. There are no institution holding or/and buying it. It is a big plus. There are only 18 million shares right now and the insiders holds almost 1/3 of them. Even it was up to $11/16 (up almost 50%) yesterday, the market value is only $13 million---even less than the value of their holding of Nakamichi Corp. which was worth almost $34 millions. I believe this is a life time opportunity to buy cheap stock.

In summary, I think that the worst time has over and we have hold the stock for 3-4 years (I bought as high as $11) and it is time to get some rewards. I am selling all my other stocks to buy this one.

I hope this could help.

Good luck in investing.

Albert
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