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Microcap & Penny Stocks : FRANKLIN TELECOM (FTEL) -- Ignore unavailable to you. Want to Upgrade?

To: VALUESPEC who wrote (25430)	1/19/1998 9:27:00 AM
From: VALUESPEC	Respond to of 41046

In an earlier posts I made two comments, which seemed, to me, to have received valid complaints from those on this board. The first comment was on the ATT litigation which I immediately agreed might be in error, and would repost my opinion on that issue after further review. Today I offer that review. My second comment was my opinion on the private placement, I'll give that second review in another post soon. First the legal proceeding which can be found in the most recent 10Q, dated Sept 30, 1997: << Legal Proceedings On July 28, 1997 the Company was named as a defendant in an action brought by AT&T Corp. ("AT&T") against Connect America, a reseller of "800" number service, its officers and affiliates, and several Internet Service Providers, including the Company. The action was brought in the U.S. District Court for the Central District of California. In general, the complaint alleges that Connect America and its officers fraudulently acquired 800 numbers from AT&T, failed to pay for them, and resold them to the Company and the other Internet Service Providers on a "flat rate" basis, notwithstanding the fact the AT&T's charges for 800 service are typically based on time utilized. The claims against the Company and the other Internet Service Providers are based on unjust enrichment, on the theory that the Company and the other Internet Service Providers knew or should have known that flat rate 800 service was unavailable. In addition to injunctive relief against Connect America and its officers, the complaintseeks damages of $7.4 million, punitive damages and attorneys' fees. The Company has filed an answer to the complaint denying the material allegations thereof, and plans to vigorously contest the action. There can be no assurance that the Company will be successful in its defense of the action. Because of the large amount sought in the complaint, an adverse outcome would have a material adverse effect on the Company's financial condition.>> I stand corrected. The issue was not that FTEL was selling 1-800 numbers over the internet and, therefore, cutting ATT out of long distance revenue unjustly by the nature of making long-distance calls over the internet. The issue appears, to me, to be that FTEL is accused of accepting service from a company on terms that appeared too low, and billed in a way which was obviously against normal industry practices, so that FTEL should have looked further to see why the charges were so low. Maybe FTEL's situation is like a car dealer being offered 10 new corvetts for $1,000 each from someone who claims to be a supplier when they usually go for $25,000 each wholesale. Was that car dealer unjustly enriched at GM's expense if he buys them, knowing those terms aren't normal? That seems to be the same situation FTEL is in with recieving the cheap 1-800 numbers (though I don't know how much cheaper the rates were then normal. Did the company say?). The lawsuit is for $ 7,400,000. What is the chance of ATT winning? Is FTEL likely to settle? If so, for how much? Maybe Raleigh can answer these questions since he's been studying this company for a while. Lawsuites like this are generally considered a yellow flag. VALUESPEC valuespec.com

To: VALUESPEC who wrote (25430)	1/19/1998 9:42:00 AM
From: VALUESPEC	Respond to of 41046

Has eveyone noticed how much the president is getting paid? He was just given an $ 84,000 per year raise, to a new yearly total of $324,000 per year ! And this doesn't include the zillions of stock options he's getting. Warren Buffet is generally not in favor of stock options. What do you think he'd say about this deal? Why? Why do you think he's taking so much money from the company via a pay check? I have included some innuendos in this post. However, I think they are valid, as to me the pay seems excessive. Again, another yellow flags goes up for me. From the most recent 10Q, dated September 30, 19987: << NOTE 5--SUBSEQUENT EVENTS The Company's President is employed pursuant to an Employment Agreement expiring on December 31, 1997. The Employment Agreement provides for monthly compensation at the rate of $20,000, with annual increases of 6%. The Company's Board of Directors has approved a new six year Employment Agreement for the Company's President, effective January 1, 1998. The new Employment Agreement provides for compensation at the rate of $27,000 per month, with annual increases of 6%. In October 1997, the Company's President exercised stock options for 1,333,695 shares of common stock at $0.10 per share.>> I might also add that I'm not trying to trash this company. I'm just looking at it and saying what I see. If you don't like what I'm saying, or don't agree with me, I hope you take the time to give me your view and why you hold it. VALUESPEC valuepec.com

To: VALUESPEC who wrote (25430)	1/19/1998 2:38:00 PM
From: Giora Zeevy	Respond to of 41046

You make it too simple. In the world there are Gm Ford and also Subaru. Giora

To: VALUESPEC who wrote (25430)	1/19/1998 3:38:00 PM
From: jim bowman	Read Replies (3) \| Respond to of 41046

MR. VALUESPEC Unfortunately, posters can swoop in on a forum like FTEL's, say virtually anything in their posts, and then have unsuspecting readers view them and treat the information as legitimate. New readers, brokers, even analysts may not scrutinize the veracity of the information, just witness the turmoil and wrongly conclude that the stock is isn't a good risk. While that might not be a big deal to the poster sitting anonymously at his keyboard, poorly researched or ill-conceived posts can still cause damage to the investor (see recently posted article from the investment community). As a non-stakeholder, you are offering negative, unbalanced views (some would say bashing) of FTEL at the potential expense of real investors who have done exhaustive DD and have chosen to invest money. You and others like you just might be digging yourselves into a hole with some your posted comments. Consider this: A time and place in the future when an appellate court rules against an irresponsible poster to stock forums similar to FTEL's. At that point, case law will be established that will help define your accountability for everything you have already posted. And while you might be laughing this off, your posts are recorded and if they can later be shown to have depressed the stock price through inaccurate posting, half truths or in a manner that otherwise unfairly damages the reputation of the company -- in a way that makes ME lose money -- I'm going to want someone (you) to pay me for that. And, while I don't purport to speak for others on this thread, there may be others of like mind. This might apply even if the long term stock price goes up if it can be empirically demonstrated that these types of comments have even temporarily CONTRIBUTED to depressing the stock price and have in some unforeseen way, tangible way adversely affected investors. Your point about big companies not wanting to buy from FTEL because of concerns about "bankruptcy" is a case in point. If you really studied this new, exploding industry you'd know this extreme outcome is not probable with a company that has proprietary, high quality products that are otherwise rated highly and valued in the market. If a number of big companies wanted to order product from FTEL, and the only thing standing in the way was fear of FTEL's solvency, you can bet that a bigger, more solvent company would be happy to step up and buy out, fund or partner with FTEL to make orders happen -- like WCOM? To throw terms around like "bankrupt" is inflammatory and might scare away would-be investors which, in turn, may affect this investment for many in some adverse, tangible way. So anyway, there's my $0.02. Post whatever you want to be held accountable for and never have to say you're sorry. Regards, Jim