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Microcap & Penny Stocks : Universal Medical Sytems (UMSI) -- Ignore unavailable to you. Want to Upgrade?

To: Dan Dieffenwierth who wrote (311)	11/5/1997 9:01:00 PM
From: HG	Read Replies (2) \| Respond to of 1672

Dan and All, These excerpts are from an E-mail conversation I Had with Tom Kostas this evening and a conversation he had with Mike Baker this afternoon. I will try to do justice with the information I have and hopefully it will be in some order. Much of it is exactly as we have speculated. The basic reason for the stock decline was the last financing package that was a Reg. S with no limitations on conversions or floor price which we have already speculated spelled diaster. The new financing pkg. is not able to convert until next year which will provide some breathing roombetween now and then. The SEC filings will be out Nov. 15th (at least that's the date anticipated) The reason for the long delay was simple---money. The company was cash poor and needed the financing to pay bills, including the accountants doing the filings. The new financing pkg. will be done in traunches to limit the dilution at each given level. The theory being that when more money is needed for the next traunch the stock price will be higher due to positive developments. I have been assured, as much as anyone could, that Mike Baker's business plan is solid and he is very adept at what he does and the methods he uses. The basic weakness in all of this is that the funds ran dry which necessitated a bad financing package (the last one Reg S) which in turn depreciated the stock. Now, and finally, this information was gathered this evening and is excerpted from a conversation that Tom Kostas had today with Mike Baker. I know how quick we are to judge Kostech when things go wrong and I believe that we are justified in that criticism. However I do not hear us, including myself, give them credit for the many,many stocks that appreciate 200-300-400 %in a short period of time. I can tell you this Kostech (and Tom Kostas in particular) feels badly about this one. He also made it clear that they have recieved no compensation. Their only compensation is an option package which is good only if the company's stock is successful. IMO that's the way it should be. Tom Kostas assured me that the only thing that they are interested indoing is finding the best companies they possibly can, help them make their business plan and help us make money. He also stated that Kostech has purchased a considerable amount of shares. just like we have, and has also averaged down just like many of us have. I just want to say that I appreciate the candor of Tom Kostas and his willingness to share his candor with me so that I could pass it on to the fine people on this thread. This shed a lot of light for me, and I hope it does for you. Personnally, I hanging in there to see what happens. Everything tells us that this company has what it takes, it's just going to take a little longer. Sorry about the length of this but there was more here than I expected. I hope it helps. I did not edit this so forgive the typos. Regards, HG

To: Dan Dieffenwierth who wrote (311)	11/5/1997 9:04:00 PM
From: HRAKA	Read Replies (1) \| Respond to of 1672

All, Tried to get a hold of Zani or Baker today, they were in a meeting. Last time I needed to talk to them it took 4 calls. I will try again tomorrow. I have no idea why the share price is where it is. I have done as much DD on this firm as I can, and this is one of the most undervalued BB stocks around. My suggestions are to hang tough and don't bu anymore until the 10k comes out. When the 10k comes out we will see how honest management has been. I honestly believe that everyone here will be pleasantly surprised. I will keep hounding the phones. This company has serious revenues for the price per share. Hraka