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Technology Stocks : Osicom(FIBR) -- Ignore unavailable to you. Want to Upgrade?

To: craig crawford who wrote (4685)	1/24/1998 4:46:00 AM
From: lisa	Read Replies (2) \| Respond to of 10479

Craig, Why so nervious, your tipping your hand, all the information your hashing up is "old news", this thread examined everything your talking about a long time ago!!!!!!!!! keep it honest ill be checking your posts for typo's, if you know what i mean!!!!!

To: craig crawford who wrote (4685)	1/24/1998 6:06:00 AM
From: craig crawford	Read Replies (1) \| Respond to of 10479

Ok, I'm starting to wade through the 10K. Looks like I found out what BW is for. It is a 279,000 square foot manufacturing facility in mainland China. Looks like for the year ended Jan 31, 1997 FIBR relied on 1 single OEM for 22.7% of net sales. Yikes! That's a lot riding on one customer. I hope FIBR has diversified their customer base over the past year. Didn't FIBR state that the decline in sales last Q was due to slowing spending from OEM's? I hope they still have a cozy relationship with this OEM. I'd hate to think what would happen if that OEM started looking elsewhere for product. You know if I was a customer of Osicom and I accounted for 22.7% of their entire revenues I would use that leverage to negotiate pretty good pricing for the product I was buying. You see, I don't think FIBR has any special things to offer that couldn't be found elsewhere. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ One OEM customer accounted for 22.7% of net sales for the year ended January 31, 1997. Because the Company's OEM customers are generally not obligated to make minimum future purchases, or to provide the Company with binding forecasts of product purchases for any future period, the failure to achieve and maintain significant sales to OEMs or to offset any decline in sales to particular OEM customers would have a material adverse effect on the Company's business, results of operations and financial condition. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Excuses, excuses. FIBR needs to maintain almost 1/4 of it's total assets in inventories? Didn't FIBR just knock $5 million off it's books to allow for reserves? (from $26M to $21M) It's dangerous to have a lot of inventory on the books because inventory can become obsolete rather quickly and ASP's for networking equipment decline rapidly. Have you ever heard of inventory getting more valuable while it sits on the shelves? Nope. Nowhere for the value of this "asset" to go but down. I would much rather see cash on the books. FIBR has practically none. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ The Company has historically maintained high levels of inventories to meet the output requirements of its customers and to ensure an uninterrupted flow of inputs from its suppliers. It is not the Company's standard policy to grant customers the right to return merchandise that performs according to specifications, nor is it the Company's standard policy to grant customers extended payment terms. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Looks like a majority of the money lent to FIBR is from "Coast". (The institution that FIBR gave warrants to). You give us some loans, we give you some warrants to buy our stock, badda bing, badda boom, blah, blah, woof, woof. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ At January 31, 1997, the Company had credit facilities of $24.1 million of which $15.7 million were utilized as of that date. These credit facilities include $16.0 million provided by Coast Business Credit ("Coast"), an asset based lender, collateralized by accounts receivable, inventory and equipment and $8.1 million provided by various financial institutions in the Far East collateralized by FED's leasehold land and buildings, fixed bank deposits, and inventories. (See Note E to the Consolidated Financial Statements contained in Part II herein). ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Your gonna love this one. Apparently (correct me if I'm wrong, I don't want to mislead anyone) FIBR has a subsidiary that generated $50 million in revenues last year that is based in Hong Kong. You know, Hong Kong! (Big trouble in little China these days). I WONDER HOW BUSINESS IS DOING IN HONG KONG THESE DAYS?? ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ We did not audit the financial statements of a foreign subsidiary which statements reflect total assets of $26,689,000 as of January 31, 1997 and total revenues of $50,692,000 for the ten months then ended. Those statements were audited by other auditors whose report has been furnished to us, and our opinion, insofar as it relates to the amounts included for such subsidiary, is based solely on the report of the other auditors. BDO Seidman LLP Los Angeles, California April 15, 1997 ~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~ Arthur Andersen & Co. Certified Public Accountants ---------------------------- 25/F., Wing On Centre 111 Connaught Road Central Hong Kong AUDITORS' REPORT TO THE SHAREHOLDERS OF UNI PRECISION INDUSTRIAL LIMITED AND SUBSIDIARY (Incorporated in Hong Kong with limited liability) We have audited the accompanying balance sheet of Uni Precision Industrial Limited and Subsidiary (the "Group), incorporated in Hong Kong, as of January 31, 1997 and the related statements of income and cash flows for the period April 1, 1996 to January 31, 1997, expressed in Hong Kong dollars. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Group as of January 31, 1997, and the results of its operations and cash flows for the period April 1, 1996 to January 31, 1997 in conformity with generally accepted accounting principles in the United States of America. /s/ Arthur Andersen & Co. - ------------------------- ARTHUR ANDERSEN & CO. Hong Kong, March 14, 1997

To: craig crawford who wrote (4685)	1/24/1998 11:57:00 AM
From: Robert Gordon	Read Replies (1) \| Respond to of 10479

On January 31, 1996, the Company's wholly owned subsidiary, Meret,increased its then $5,000 line of credit from Coast Business Credit ("Coast"), an asset based lender, to a maximum of $8,000; the line of credit is collateralized by accounts receivable, inventory and property and equipment. Osicom has guaranteed this line, for which Meret is the borrower, to the extent of $1,000. This line of credit provides for interest at 2.5% over the bank's prime rate but not less than 8% (11.0% at July 31, 1997). In addition, the Company issued to Coast three year warrants to purchase shares of its common stock at the respective market prices at funding: 10,000 shares of its common stock at $3.34 per share expiring June 11, 1998 and 40,000 shares of its common stock at $5.31 per share expiring January 31, 1999. Advances are limited to 80% of eligible accounts receivable and 25% of eligible raw materials and finished goods not to exceed the lesser of $1,000 or 75% of then outstanding accounts receivable loan. The agreement remains in effect until February 1, 1999 and automatically renews for successive additional terms of one year on a continuous basis unless terminated by written notice of either party or by default. Additionally, the agreements provide for term loans more fully described in Note F. Meret paid Coast a $30 origination fee and the quarterly facility fee was increased to $4. The interest rate on the Meret line of credit remained unchanged at 11.0% for the six months ended July 31, 1997. The highest and average amounts outstanding were $3,070 and $2,187, respectively, during the six months ended July 31, 1997. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Yes this is a horrible loan for us! what can we do? we need the money. I think Par is running out of free loans for our company. Now we could try to issue more shares on the open market. But Par doesn't want to dilute his shares too much. He must be real greedy after all he is a major shareholder. So we get this 8 million dollar line of credit at 11% interest. We also give the loan company 50,000 shares. Yuck! AFTER ALL WHEN OUR STOCK IS $20 DOLLARS NEXT YEAR THAT IS ONE MILLION DOLLARS!!!! But after all who is going to loan us the money? It is clear to me that Coast believes our stock will be worth something in a couple years or they would have never agreed. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~