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Strategies & Market Trends : cash-rich dot bombs -- Ignore unavailable to you. Want to Upgrade?

To: blankmind who wrote (119)	12/24/2000 5:55:21 PM
From: American Spirit	Respond to of 184

Are any internet firms with 2/3 of the market cap in cash making money? And who's to say ESHR doesn't make profits this coming year. They beat estimates and have signed some pretty nice deals lately. Frankly, I don't know for sure but at this miniscule price it's definitely bargain buying time. Wish I had more cash.

To: blankmind who wrote (119)	12/26/2000 7:43:36 PM
From: Glenn Petersen	Read Replies (3) \| Respond to of 184

There are no guarantees that the management of these cash rich failures will act for the benefit of their shareholders. Self interest is more likely. The management of NPLI recently announced a bid of $.65 per share for the 48% of NPLI's stock not controlled by insiders. As of September 30, 2000, NPLI had $76.4 MM in unrestricted cash, or about $1.27 per share. The stock was selling at $.34275 per share, or a bit less than 30% of its September 30 unrestricted cash value, when management announced its bid. The company exited the appliance business and restructured its operations in October, laying off 38% of its workforce and ceasing its manufacturing and marketing activities. It took a $11.4 million charge for inventory writedowns and booked a settlement of $6.3 million with its manufacturer. Including its restricted cash balance of $11.9 million (which is related to a letter of credit for the manufacturer), the noncash current assets approximate $22.8 million, just enough to offset the liabilities which total $22.3 million. There is one significant contingency that is impossible to quantify at this time. In July 2000, the company signed a network service agreement with AT&T which calls for the payment of $32.6 million over the next four years. There are some termination provisions in the contract that will probably reduce that amount but I have been unable to find any details related to those termination provisions. To recap, the holders (all insiders) of 52% of the company's common stock are offering the remaining shareholders approximately $19 million dollars for a company that controls approximately $70 million in cash (subject to the AT&T contingencies) and is in the process of redefining its business plan. A fresh start, minus the public shareholders.