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Technology Stocks : Log On America, Inc. LOAX -- Ignore unavailable to you. Want to Upgrade?

To: Edward Boghosian who wrote (233)	8/26/1999 7:58:00 PM
From: Fundamentls	Read Replies (1) \| Respond to of 353

It's certainly not earnings. This company has virtually no revenues and is losing a ton of money, and is paying rack rate to acquire nearly-bankrupt, money-losing companies (when they bother to tell us what they've paid at all). The news they keep putting out is absurd. Last week they announced that two investment banking firms had initiated "strong buys." You had to look closely to realize that the release was issued by the company not by the investment bankers. You did not have to look closely to realize that the investment bankers were total unknowns, one of them not even domestic. Even after researching them I could find only one other company either of them had EVER recommended before. LOAX acquired a company in July that was down to its last few dollars in cash, hemorhaging cash flow, located in a geographical territory where they have no synergies, and so burdened with debt that all of its loans and credit lines had to be personally guaranteed by the owners. LOAX noted it was accretive to "earnings" (of which they have none), which only pointed out that LOAX was even LESS profitable than the acquired company. And oh yes, when they finally got around to admitting what they'd paid, it was clear why they hadn't announced the price in the first place. The stock given in trade would have been fair if the acquired company had been breakeven or even marginally unprofitable, but the real kicker is a $5 million "put" option the sellers got if the LOAX price isn't at least $15 when the stock gets registered and becomes tradable. They haven't announced the terms of the two latest acquisitions (after the last one I can understand why), but a D&B I ran on one of them showed it with 23 employees and projections (future) of $1 million in revenue, which means they're losing a ton of money as well. Two of this company's principal's credentials (including the president's) included being "active in" (I'll take that to mean "working in" since it doesn't say principal, owner, officer, etc.) a tavern for 20 years. So what's with the run-up? It sure isn't valuation or sector. By comparison with most any other ISP (including those that are actively delivering DSL), LOAX is overvalued by a factor of 5 to 10, depending how you calculate it. And small-cap third-tier nets have been getting killed this week. It isn't news, since the only news that's been released has been nauseatingly amateurish. I expect we will find this to be a pump and dump. By whom, I don't know, maybe some large holder who's figured out what a POS it is. But even after the run-up, borrowable shares are very difficult to find, which rules out this having been a major short squeeze. I unboxed my short position a little early but I'll hold it to 30 or more if I have to. Insider shares start coming on the market as soon as they register the shares issued on the first acquisition, which must be no later than early November. A ton more come on next spring when the original insiders get released from lockup (could happen earlier if Dirks let them, but I doubt he will). This is an overvalued ISP who thinks they can own the world by offering one-stop shopping for everything from cable and DSL to local and long-distance service. Their competitors include (with this specific strategy) AT&T, Sprint, and MCI WorldCom, and (with overlapping but different strategies) AOL, MSN (which is considering offering internet access for free), VRIO, RTHM, ATHM, Bell Atlantic, and dozens of other blue-chip, and tier-1 net companies that could chew up and spit out LOAX like an ant. This stock will trade in low single digits in 6-12 months.

To: Edward Boghosian who wrote (233)	8/26/1999 11:07:00 PM
From: Ron Dior	Respond to of 353

Log On America Appoints Two Top Level Executives PROVIDENCE, R.I.--(BUSINESS WIRE)--Aug. 26, 1999--Log On America, Inc. (Nasdaq NNM: LOAX), a provider of high-speed DSL services in the Northeast Corridor, today announced it has appointed Peter Fornal, Vice President of Human Resources and Steve Head, Director of Switched Facilities. Mr. Fornal joins Log On America with extensive senior-level human resource management experience in diversified international and domestic businesses. He has a successful track record of impacting profitability through customer service, continuous improvement, organizational development and strategic planning initiatives. Mr. Fornal has held several notable positions in the human resource (HR) arena including Vice President of Personnel for the Information Systems Group of Motorola, where he managed the turnaround of several business unit functions to establish credibility and contribute to 30% growth per year, as well as, the successful integration of significant product and operational change including mergers, acquisitions and downsizing. Prior to that, Mr. Fornal held the position of Vice President of Industrial Relations for Hasbro, Inc. where he established a proactive, cost-effective HR function, significantly improving labor relations and contributing to operating efficiencies. Mr. Fornal is a recognized leader in the human resource community and currently is Vice Chair of the National Employee and Labor Relations Committee for the Society of Human Resource Management. He is also the President of the Rhode Island Wellness Council and a past chapter President for the R.I. Human Resource Management Association and the Association for Quality and Participation. "We look forward to having Pete serve as an external and internal consultant and leader in further developing Log On America's high performance workplace," said David Paolo, Log On America's Chairman/CEO. Mr. Head brings 21+ years of hands on experience in domestic and international telecommunications. He has built and managed cross-functional teams to implement complex telecommunications systems, both in the United States and Asia Pacific. Mr. Head most recently held the position of Senior Regional Program Manager for Nortel Networks, where he managed the nationwide deployment and integration of Point to Multi-point Broadband Microwave Radio equipment into a nationwide network. Additional credits include the management, implementation and deployment of various telecommunications switching system programs in the United States, Japan and Korea. More specifically, Steve has worked as the Chief Engineer in rolling out 29 DMS-100's for the US Army in Korea from the ground up, as well as, managed the first competitive international long distance carrier program to KDD in Japan. He has also managed other ground floor projects with MCI Metro (now MCI Worldcom) and most recently with Teligent. "Steve will be acting as a consultant to Log On America from Nortel Networks. As we build up our switching infrastructure, he will be strategically placed between both companies to ensure a smooth entrance into the regional CLEC opportunity, utilizing the power of Nortel Networks equipment and services," said Paolo. About Log On America Log On America Inc. is a Northeast Regional Competitive Local Exchange Carrier (CLEC) and Information/Internet Service Provider (IISP) providing local dial-tone, instate toll, long distance, high-speed Internet access and cable programming solutions over traditional copper wire using Digital Subscriber Line (DSL) technology to residential and commercial clients throughout the Northeast. Forward-Looking Statements This news release may contain forward-looking statements concerning the business and products of the company. Actual results may differ materially depending on a number of risk factors including, but not limited to, the following: development, shipment and market acceptance. Other risks inherent in the business of the company are described in Securities and Exchange Commission filings, including the company's prospectus on Form SB-2. The company undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this release. CONTACT: Log On America Melissa Hamilton, 401/459-6286 E-mail: mhamilton@loa.com or Makovsky & Company Michael Lendener, AVP 212/508-9690 E-mail: Mlendener@makovsky.com KEYWORD: RHODE ISLAND BW1037 AUG 26,1999 4:29 PACIFIC 7:29 EASTERN