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Microcap & Penny Stocks : FAMH - FIRAMADA Staffing Services -- Ignore unavailable to you. Want to Upgrade?

To: Brad who wrote (2703)	2/4/1998 8:44:00 PM
From: Buckeye	Read Replies (1) \| Respond to of 27968

Brad, Great Post! Ira talked about doing it monthly, and the financing agreement calls for a two year contract.

To: Brad who wrote (2703)	2/4/1998 10:58:00 PM
From: Andrew H	Read Replies (1) \| Respond to of 27968

>>However, if the financing agreement has a "buy back" option (as I believe it does), FAMH could (depending on the details) get $12 Million by giving out 40MM restricted shares now. Then 9 or 10 months from now, draw down another $12 Million (plus X% interest amount) and offer restricted shares at the "then current price" of say... $3.00 per share (that's only 4MM shares). They then use the new $12 Million (plus interest) to pay off the original draw down and buy back the original 40MM shares. In other words, pay the interest on the original $12 Million and trade out 4MM $3.00 shares for the original 40MM 30› shares.<< Brad, if pigs could fly, I'd be in Hawaii right now. (:>) Listen, the deal you describe is absolutely too good to be true. I have heard of a lot of stock deals for money, but never anything like this. In this scenario, the lender gains nothing but the simple interest on the loans, while he is forced to hold the shares for a year while being unable to participate in any upside. What lender in his right mind (especially for a BB stock) would sign an agreement committing him to lend another 12MM to buy back 40MM shares at the original price of .30 when they have appreciated 1000%? Also, there is a big problem with this scenario, even if such a sugar daddy lender should materialize. First of all, if the 40MM shares were issued for the loan as you suggest above, have you any idea what that would do to eps calculations? More than divide them in half, which would make a $3.00 price virtually impossible. With great luck, in a year or so, it is barely possible that the company with 30MM shares out could reach a pricve of $3. Possible but highly unlikely. However, with 70MM shares out, it is barely within the realm of imagination.

To: Brad who wrote (2703)	2/5/1998 1:57:00 AM
From: Eamons	Read Replies (1) \| Respond to of 27968

Hello Brad! Your posts and knowledge are greatly appreciated. I'm new to this type of financing but am constantly learning. My question is: What's the difference between this type of financing and simply selling this bank new restricted shares with the option to buy them back (at the original price). Plus giving the bank interest for the privilege? My only experience with finances are personal finances. I just can't seem to correlate this with any type of credit or loan that I'm used to thinking of. If it was straight credit or a loan then the bank would loan the money for interest, payment plan, and collateral. In this case it looks like the collateral will come out of the shareholders pockets in the form of dilution. Not putting the company at risk but the shareholders. No flame or discredit intended. I really enjoy and learn from your posts. Am I way off base here? -Stu

To: Brad who wrote (2703)	2/5/1998 9:14:00 AM
From: CAPT.DAN	Read Replies (2) \| Respond to of 27968

Brad, Perhaps this is over simplified, but if the financing is as you described, is it any different than obtaining a loan for a house. The lender takes the house as collateral and when the principal and interest are paid back you have clear title to the house. Or in the case of Famh, all of the stock. The money borrowed for a house is base on the appraised value at the time of the loan not at the end of the loan. All the lender desires is to have the interest paid and to be covered in case of a default on the loan. In my eyes stock or real estate are both the same, collateral. Granted if this were a start up company the lender might require a piece of the pie. Thoughts anyone? Dan