Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : PYNG Technologies -- Ignore unavailable to you. Want to Upgrade?

To: sPD who wrote (418)	12/20/1997 10:27:00 PM
From: Chris L.	Read Replies (1) \| Respond to of 8117

Dear Mr. Jacobs: I have been following your company for the last 2 yrs, and have almost jumped on board a few times, but I was worried about a) Financing (i.e. getting the product to market may cause a large amount of dilution in the share value, or may not be possible without a JV or some sort) and b) the actual market potential of this product. Lets look at part a) Looking at this financing agreement, I have three questions.. WHY, WHY, WHY??? Why would Pyng do a PP when the share price is at these low-low levels? More importantly, why would you do the PP at $0.88 for 1 share PLUS one warrant at $0.88?? Let me do some hypothetical math: Lets assume the PP holder decides to exercise these warrants IMMEDIATELY - There net cost for 284091 shares would be $187500, or $0.66 / share (60% of the current share price!!!) (they exercise at $0.88, immediately sell at $1.10). Although this is unlikely because the warrants hopefully are not exercisable until some date in the future, and the liquidity for Pyng is low, this type of deal simply stinks from the shareholders view. (In fact, I would have LOVED the opportunity to do this PP - who was on the other side??? Do you need another $250,000?) Mr Jacobs, I understand the need for cash injections, but even a low-cap company like yours should be able to obtain debt financing at less than 10% interest, which would retain shareholder value more than simply 'giving away' shares like this. In addition, why $250000?? Is this tiny little amount really going to get the FAST1 to market, and if not, why not do one more lump sum financing deal to get the company 'over the hump'? I have noticed the company's tendancy to get financing in dribs and drabs, and from a transaction costs point of view, this makes very little sense. Do you have any feel for how much extra money is needed to bring the FAST1 into production? Will actual production be done by the company or contracted out? Now, part b) When I first got interested in Pyng's FAST1, I thought it was too good to be true - A life saver, repeat business, no real market alternative, and possibly HUGE potential markets. I even remember seeing a spreadsheet (from IR at the time, I believe) showing revenue forecasts for years 1 through 5. Do you have any official or unofficial '98 revenue forecasts for the company? How much potential market penetration is really possible to traditional methods? What do you feel will be the gross margin on sales?? Mr. Jacobs, I believe your company has a huge potential, and would be real, real bullish about Pyng with the answers to these many questions (sorry for the quantity!), so I could see a concrete business plan to make your company a success. Thanks, Chris