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Strategies & Market Trends : BFT: Will the tulip craze ever break down? -- Ignore unavailable to you. Want to Upgrade?

To: Kip518 who wrote (109)	3/19/1998 4:17:00 PM
From: Don Westermeyer	Read Replies (2) \| Respond to of 650

FWIW - I joined the crowd shorting BFIT today on the news of the secondary. (Not that is wasn't as good short before, it was.)

To: Kip518 who wrote (109)	3/19/1998 9:26:00 PM
From: Witling	Read Replies (1) \| Respond to of 650

Wow. 88% dilution in one year and a quarter: From the 10-K, 1996 shares outstanding = 12,495,161 1997 shares outstanding = 20,575,092 From the S-3, 1998 shares to be issued = 2,875,000 That's about 23,450,000 shares in total when this lot is sold, or 88% increase from 12,495,161. During that time, the stock price rose from about $8/share to $29/share -- roughly a factor of six, considering dilution. Debt dilution appears to be a winning strategy. (Unless you expect the price to decline in response to this latest insult. You don't, do you?) 1997's net loss was about $45 million, or about $23.5 million before "extraordinary" refinancing item of $21.5 million. From the footnote below, I guess another "extraordinary" refinancing expense might occur in each of the years 1998 ($67 million debt matures in 1999) and 1999 ($96 million debt matures in 2000). Maturities of long-term debt (excluding the $22,555 aggregate principal amount of the 13% Notes redeemed in January 1998) and future minimum payments under capital leases together with the present value of future minimum rentals as of December 31, 1997 are as follows: LONG-TERM CAPITAL DEBT LEASES TOTAL --------- ------- -------- <S> <C> <C> <C> 1998............................................... $ 2,527 $ 3,498 $ 6,025 1999............................................... 67,054 3,129 70,183 2000............................................... 96,092 2,076 98,168 2001............................................... 1,118 1,523 2,641 2002............................................... 3,002 1,413 4,415 Thereafter......................................... 227,096 16,177 243,273 -------- ------- -------- 396,889 27,816 424,705 Less amount representing interest.................. (14,690) (14,690) -------- ------- -------- $396,889 $13,126 $410,015 ======== ======= ========

To: Kip518 who wrote (109)	3/21/1998 9:11:00 PM
From: Pancho Villa	Read Replies (1) \| Respond to of 650

Kip, Just got back from FL. I will study the 10K carefully tomorrow. IMO as you seem to have realized already, the whole thing is just a big joke. If they can get away with screwing a few dummies with 2.5 million shares at $29 without moving the price I would be surprised, but given that BFIT is the ultimate gravity defying stock you never know. I guess Mr. Hillman is ready to burn some money behind some exciting ideas and continue to invest in a business with extremely poor return on investment. BTW, it seems he can't raise same store sales so he is gonna go the RAYS way, buy revenues even if there will be losses attached to every extra dollar of revenue. When and if this puppy ever falls I am gonna have a ball! Pancho pancho