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Technology Stocks : TAVA Technologies (TAVA-NASDAQ) -- Ignore unavailable to you. Want to Upgrade?

To: JDN who wrote (5869)	11/13/1997 7:32:00 AM
From: RDavidson	Respond to of 31646

JDN, I find myself going back on a previous belief on further dilution for the following. TPRO's cash flow model will not be static. Short run, the better their business prospects, the worse their short term cash flow is, assuming further investment for new hires, CD updates, hardware for ongoing contracts, etc. All require cash, hopefully, big cash. Contracts are probably also subject to being restructured to encompass more work and revenue. You know better than most what loan negotiations regarding debt financing entail. Your cash flow model better be good, because your repayment schedule will flow from that. As difficult as debt financing is, restructuring is twice as hard. I think at the present time, no spreadsheet is good enough to allow TPRO to "kiss the paper on". There's almost nothing worse than overhanging debt when your capital needs are increasing rather than easing. A limited equity offering to a holder who hopefully will not induce further volitility into the issue is probably the best in a list of none too desireable possibilities. The dilution factor has to be weighed against the stream of income the cash enables. Based on management's pragmatism in past decisions, (they're unbelievably conservative for small cap), I'll support this decision. I appreciate your thoughtful post. Regards, Roger D