Stop me if you have heard this one before:
Absent a significant increase in sales, which itself may require a significant increase in working capital, the Company will require significant additional funds during 1999 to continue its operations. The options the Company is reviewing to obtain additional financing include, but are not limited to, the sale and issuance of stock, the sale and issuance of debt, the sale of certain assets of the Company and entering into an additional strategic relationship or relationships to either obtain the needed funding or to create
what the Company believes would be a better opportunity to obtain such funds. It is possible that any such additional infusion of capital would be in the form of the sale and issuance of additional shares of Common Stock or securities that are convertible into Common Stock, which would substantially increase the number of shares of Common Stock outstanding on a fully-diluted basis. However, there is a significant likelihood that additional funding or strategic relationships will not be available on terms acceptable to the
Company, if at all. The failure to obtain such additional funds would cause the Company to cease or curtail operations. Even if such additional funding is obtained, there is no assurance that the Company will be able to generate significant sales of its products or services, or, if the Company is able to consummate significant sales, that any such sales would be profitable.
Reg FREEKIN' S. Fantastic. RMS gave them two million dollars and thought that was going to be enough. I guess that if it is not enought, they plan not to contribute anymore?? Which would make them want to start selling stock before the Reg S shares get sold? Vulture capitalists?? We will find out... Reactions?
Oh, and this is funny:
Approximately 80% of the Company's 1998 revenue was from the sale of software licenses and related services to one customer. No other individual customer accounted for significant sales. Three customers accounted for approximately 21%, 18% and 12%, respectively, of 1997 revenue. In fiscal 1996, the same three customers specified in 1997 accounted for 39%, 0% and 48%, respectively, of total revenue.
Kinda makes that tremendous revenue increase look pretty bad??
Finally, this doesn't help:
"FOURTH: The total number of shares of all classes of stock which the Corporation shall have authority to issue is 26,000,000 shares,
consisting of (i) 1,000,000 shares of Preferred Stock, $.01 par value
per share (the "Preferred Stock"), and (ii) 25,000,000 shares of Common Stock, $.01 par value per share (the "Common Stock"). Upon amendment to this Article to read as herein set forth, each six (6) shares of outstanding Common Stock is converted into and reconstituted as one (1) share of Common Stock."
3. The foregoing Amendment to the Certificate of Incorporation has been duly approved by the Board of Directors.
MORE SHARES!!!!!!!!!!! WOOOHOOO!!!!!!!
Oh, yes and now we should really care about Polaroid, I guess:
TRANSFER OF WELFARE CONTRACTS -- As part of its strategy to increasingly rely on its resellers for marketing and support to end-users in vertical market segments, the Company transferred its contractual responsibilities for management of the I&A aspects of the State of Connecticut welfare system to the prime contractor, Polaroid Corporation ("Polaroid") effective March 1, 1999. In addition, it has also entered into an agreement, subject to receipt of the written approval of the State of New Jersey, to transfer its contractual
responsibilities for management of the I&A aspects of the State of New Jersey welfare system to Image Computing Incorporated ("ICI"). These new resellers for the government market, like XL Vision in the healthcare market, have the rights to market the Company's products in those vertical markets and will receive software support for the remaining term of the transferred contracts.
What do you think this means?
One good point:
The Company's software applications support numerous commercial off-the-shelf biometric hardware collection devices including fingerprint sensor peripherals manufactured by Veridicom, Who? Vision, Polaroid, Key Tronic, Identix, and Identicator; digital cameras for facial image recognition from a number of commercial sources; and microphones and sound cards for speaker authentication that are identical to those widely sold for PC audio applications.
At least we can provide hardware if need be. Price ($150 per seat) is still too huge a problem....
This is good too, although I doubt a Gateway buyout still:
The Company is working directly or jointly with strategic partners to provide the Company's software product line to major computer and peripheral vendors. The Company believes that certain of its strategic partners have established relationships with several of these target organizations.
This is sweet:
INFRASTRUCTURE PROVIDERS. The Company is pursuing relationships with computer manufacturers and communications companies that provide connectivity over virtual private networks, the Internet, and corporate intranets.
FINANCIAL SERVICES PROVIDERS. The Company is pursuing relationships with leading banks and transaction processing companies interested in providing enhanced customer service and security in electronic banking. For example, Unisys Corporation ("Unisys") deploys SAF client/server software in its Navigator/trademark/ customer service system for banking and has developed several significant prospects. Most recently, WesternBank in Puerto Rico contracted with Unisys and NRI to implement 275 finger image scanners and related software in their new branch automation system. The Company has also
signed a VAR agreement with a leading financial services provider, FIserv, Inc.
So, that's what I thought was important?? What do you guys think?
Regards,
Bob |
