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Technology Stocks : General Magic -- Ignore unavailable to you. Want to Upgrade?

To: Mark Oliver who wrote (7480)	12/16/1999 10:42:00 PM
From: Kurthend	Read Replies (4) \| Respond to of 10081

Mark, Thanks for the recent posts on unified messaging. I strongly believe that we are headed in that direction at a very fast pace. Before I continue, I will say that I am in the green with my holdings in GMGC. I believe that the Gen Mot deal has great long term potential. But, I don't know what GMGC will do in the meantime. I am still long, but very leery due to the latest S3 that was filed yesterday with the SEC. The drop in the price of the common stock on Tuesday could very well have been attributed to news leaking out about this S3. Another explanation could be that retail support for the stock just broke down and there was a lot of panic selling or stop loses. On the latest 10Q, GMGC mentioned that they would need additional shares next year but when I mentioned that to others it was quickly downplayed as though it was just legal jargon. Well, expect another vote in January or February to further dilute our shares. I can not believe that GMGC has basically gone through 60 million shares in less than 12 months. That is incompetency at the highest level. McCormick must be really feeling good now that he no longer works at GMGC. All I can say is that I sincerely hope that McCormick is able to achieve or work his same magic with his new venture. Whether I vote for further dilution is up in the air right now. What good excuses will GMGC offer its shareholders this time? The answer will be to survive by issuing more shares for more capital. Don't read into anything else that the SEC document might say as a reason for shareholder approval of additional shares. I am concerned that GMGC may be bought out at a very low price (ie hostile takeover). With basically 95 million shares outstanding or spoken for, a $500 million offer would bring the price of the stock to a whopping $5 (approximately). Is GMGC even worth that price to a competitor? Is MagicTalk or Kenya technology worth that much money? That is a question I can't answer as I don't know how hard it is or would be to duplicate the technology. The second part I am going to complain about is GMGC's ability (or complete lack thereof) to achieve any type of revenue producing deals. Is GMGC the only web site on the internet that gains revenues from banner ads only after a customer purchases a product from that banner site? All I can say is what idiot was responsible for that type of agreement? If this is truly the case, it won't matter one bit if there are 1 million subscribers on myTalk if no one buys a product from the banner ad. Can we thank Surace for this spectacular revenue gaining deal (similar to his outstanding deal with XCIT)? If Surace is responsible for this deal for myTalk (and those companies that are advertising on myTalk), then I wish him the same success as McCormick. I guess what I am trying to say is that I think GMGC's management is moronic at best when it comes to running a company. The bottom line is to make a profit. In GMGC's case, it is more like the bottom line is how long can we hang on. Unless Markman produces something very quickly in terms of another deal (one that makes money immediately) then I seriously doubt he could be considered an asset to the company and shareholders. In which case, I think that SM should quietly step aside or be fired. Maybe with a Gen Mot board member, the BOD will start looking after the best interest of its shareholders. Anyway, sorry about the long post. Take care. Kurt freeedgar.com Conversion Price. The conversion price of each Series D share as of October 29, 1999 was $1.684. The conversion price of each Series F share as of October 29, 1999 was $1.378. Resets of Conversion Price. The Series D conversion price will be reset following the last day of each March and September and on December 31, 1999 and June 30, 2000. The Series F conversion price will be reset following the last day of each December, March, June and September. The Series D and Series F conversion prices will only be reset if the reset price is less than the then-effective conversion price. As of December 10, 1999, the Company's capital stock consisted of 100,000,000 shares of common stock, 41,927,616 of which were issued and outstanding and 39,091,874 of which were issuable and reserved for issuance pursuant to securities convertible into or exercisable for shares of our common stock. An additional 15,767,127 shares were reserved pursuant to provisions of agreements governing issuance of our Series D and Series F preferred stock and those governing warrants issued in connection with the Series B, Series C and Series D preferred stock transactions that require us to reserve a multiple of the shares of common stock issuable upon conversion of the preferred stock or exercise of the warrants. We have no present plans to draw down under the equity line. However if, at the time we elect to draw down under our equity line, we do not have a sufficient number of authorized but unissued and unreserved shares of common stock available for issuance under the equity line, we may be required to seek stockholder approval of an increase in the authorized capital stock of the Company. There can be no assurance that we will obtain stockholder approval of an increase in our authorized capital stock, or that such approval will be timely. Accordingly, we cannot guarantee that sufficient funds will be available to meet our future needs. In any event, to support our operations through the year 2000, we will be required to raise additional public or private financing. No assurance can be given that additional financing will be available or that, ifavailable, it will be available on terms favorable to the Company or its stockholders. The unavailability or timing of significant revenues and financing could prevent or delay the continued provision of our services and may require us to curtail our operations. In addition, if we are not able to generate revenues or obtain funding, we may be unable to meet The Nasdaq National Market's continued listing requirements, and our common stock could be delisted from that market. See "-- Our common stock may be delisted from The Nasdaq National Market if we are not able to demonstrate compliance with the continued listing requirements. In addition, revenues from our myTalk service as well as from certain voice-enabled services licensed to partners such as Excite@Home depend on advertising and sponsorship sales. Such revenues are not currently sufficient to offset the costs to General Magic of providing these services. See "-- Revenues from our Internet service depend on banner and audio advertising sales, and our inability to generate sufficient revenues from advertising sales would harm our business." REVENUES FROM OUR MYTALK SERVICE AND THE INTERNET SERVICES OF CERTAIN OF OUR PARTNERS AND CUSTOMERS DEPEND ON BANNER AND AUDIO ADVERTISING SALES AND UPON NCORPORATION OF FEE-BASED SERVICES, AND OUR INABILITY TO GENERATE SUFFICIENT REVENUES FROM ADVERTISING SALES AND FEE-BASED SERVICES WOULD HARM OUR BUSINESS.