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Microcap & Penny Stocks : HITSGALORE.COM (HITT) -- Ignore unavailable to you. Want to Upgrade?

To: bob sims who wrote (1943)	6/12/1999 12:17:00 AM
From: dumbmoney	Read Replies (3) \| Respond to of 7056

Bob, I hear there's been a lot of illegal short selling of HITT. All HITT longs should email John Stark @ SEC enforcement and request an investigation. Email every day. Don't take 'no' for an answer. The SEC exists to protect you from fraud.

To: bob sims who wrote (1943)	6/14/1999 11:50:00 AM
From: DrStocks14	Respond to of 7056

Bob, That $100M is in stamps not cash! Are they using the stamps to send out fliers? That would be one massive mailing.

To: bob sims who wrote (1943)	6/14/1999 12:11:00 PM
From: Daniel Chisholm	Read Replies (1) \| Respond to of 7056

Hi Bob, ...HITTs is a great company that has $100 million to work with in building the business. I can't find anything wrong with their business plan nor can anyone ele. My concern is that HITT doesn't have $100 million of cash, nor do they have $100 million worth of assets that they could do some borrowing against. Without cash or access to cash, the Company cannot build its business. The nature of the Life Foundation Trust investments is, to my untrained eye, unconventional. LFT made commitments to HITT totaling "up to" $120 million, yet none of these commitments are in the form of cash, marketable securities, or the sort of asset that a third party might be willing to extend credit against. In a sense HITT is providing a loan to LFT for LFT to use to make an equity investment in HITT, in that they are accepting illiquid collateral, for a period of time, to secure LFT's pledge to deliver cash to HITT at a later time. Recall that HITT's 10-K included a "going concern" warning, dated 14 Apr 99. The chief concern that the auditors cited was that the Company "has assumed a substantial amount of liabilities in connection with a reorganization and merger agreement." Interestingly, the day after this, the Company entered into the first of the (non-cash) share sales to Life Foundation. This sort of "day after the auditors have signed off" significant transaction would ordinarily raise alarm bells in my mind, lumping it in with other "OK guys, the coast is clear for another year" shenanigans. However if I read the 10-K with the intention of giving management's integrity the benefit of doubt, there is the implication that the auditors were aware of this subsequent event (LFT's commitment to purchase $120 million of equity). Although aware of this subsequent (favorable?) event, the auditors did not amend their "going concern" qualification. The auditors must have been aware of the Company's sales of $120 million worth of equity to LFT, because in their letter that included the "going concern" clause, dated 14 Apr 99, they included mention that "Note 11" (concerning the LFT investment) was dated 24 May 99. Of course the problem here is that not everyone is willing to give management the benefit of the doubt. Because the largest shareholder (who is also the controlling shareholder) has a criminal record that resulted in imprisonment within the past ten years, as well as more recent unpaid FTC fines of a substantial amount (involving fraud, and a similar "business model"), and has been involved in the past suspect ventures with the Company's president (Bradford), it does seem difficult to unreservedly give management the benefit of the doubt. Unless there is more to know about Reed and Bradford than has been so far discovered and discussed by this discussion board, it would be difficult to imagine trusting either of them to date one's daughter or look after one's money. Perhaps in the future they will turn out to have all along been fine upstanding citizens deserving of trust and respect, but for now they must "show me". - Daniel