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Non-Tech : International Heritage (IHIN) -- Ignore unavailable to you. Want to Upgrade?

To: Arcane Lore who wrote (50)	3/15/1998 4:04:00 AM
From: Gutterball	Respond to of 454

I've looked over some of your references and it is apparent that Rule 15c2-11 is the kiss of death. In keeping with Rule 15c2-11 which requires (or should I say, which proposes) a market maker have current and accurate financial information about the issuer before trading resumes, I've gone back over Form S-8 to try to put Fridays trading and the company's financials into perspective. As I understand Form S-8, IHI has 100,000,000 shares authorized. Before Thursday's secondary offering of 400,000 shares (I have not found any records to confirm this) which brought trading into play, there were about 27.2 million shares and 8.3 million options outstanding. In total, the IHI "in crowd" was holding about 35.5 million shares while only 400,000 shrs were put into the market to determine price. Based on Friday's high of $34/shr and 35.9 million shares outstanding, the market cap of IHI was in the neighborhood of 1.2 billion dollars. Now consider (and I'm assuming here) many of those shares were earned from sales production, which BTW over the three years of the life of the company was about $160 million gross. In other words, by going public, IHI sales representatives fortunate enough to own stock/options stood to gain 7.5 times their sales production. Show me a company that pays that kind of a bonus and I'll start working for a living. To make a long story short, buying got out of hand Friday and something had to be done. International Heritage has over 100,000 sales reps, many of whom were looking to get a piece of the company when only 400,000 shares were available. No folks, those who bot at the open on Thursday at $13 share paid too much. Considering many buyers were the company's own people, this fiasco could really hurt IHI -- from loss of sales force among other things. As more information becomes public, we'll have a better idea what was going on. But at first glance things do not look good for IHI. More later?