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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG) -- Ignore unavailable to you. Want to Upgrade?

To: gambler who wrote (1410)	6/25/1998 3:16:00 AM
From: JEFF BERRY	Respond to of 44908

Gambler, Additional questions for the CC. Mr. Gordon, We are aware that TSIG is and has been experiencing a desperate cash crisis. According to the 1st qtr.report filed 5/15/98 it makes the following statement under the heading: - LIMITED WORKING CAPITAL,FINANCIAL INSTABILITY - "As of March 31 1998, the registrant had a negative stockholder's equity of ($5,873,256), an accumulated deficit of ($28,093,769), and a working capital deficit of ($6,247,685). Various factors effecting the registrant's operations raise doubt as to the registrants ability to continue as a going concern. There can be no assurance that the registrant will be able to continue as a going concern.,or acheive material revenues and profitable operations. The registrant is dependent upon sufficient cash flow from operations to meet it's short term and long term liquidity needs. These operations have not and are not expected to provide sufficient cash flows,and as such the registrant requires additional financing. No assurances can be given that financing will be available to the registrant in the amounts required,or that, if available, the financing will be available on terms satisfactory to the registrant." Mr. Gordon, this is of serious concern to many TSIG shareholders and potential investors. We are aware that TSIG is working a private placement to raise 7.5 million to help address the short term cash crisis. We are also aware that on 4/23/98 you personally signed a $5 million credit line made available to TSIG for working capital needs. During your interview with Beebs and Gambler on 6/4/98 you reported that TSIG already had commitments for the entire 7.5 mill. and that you anticipated full completion by mid-July. During the interview you also reported that TSIG does indeed owe the IRS for failure to pay Federal payroll withholding taxes. You stated that as a matter of prioity the IRS would be paid in full as soon as the P.P. is completed. Additionally during the interview we were informed that the 5 mill. revolving credit line made available by you to TSIG would not be needed due to the certainty of the P.P. execution. In light of the foregoing, if the P.P. is indeed a certainty why has TSIG not drawn on the 5 mill. credit note in order to satisfy the IRS obligations now! Then use a portion of the proceeds from the "certain to be completed" P.P. to repay the note? Of all the TSIG obligations that are outstanding, failure to pay the IRS for Federal witholding taxes has to be the most serious. Federal money withheld from employee payroll checks is not the property of the company. It is the property of the IRS. The company can not use these funds for any reason or purpose whatsoever. Payroll witholding must be submitted to the IRS in most instances within 3 business days from the date of the payroll. The IRS views failure to promptly submit payment for Federal witholding tax as tantamount to theft. When such a failure to properly remit Fed withholding taxes, the IRS has the power to seize bank accounts,as well as shut down the company and padlock the doors....Not to mention the severe penalties and interest that are levied and assessed and that continue to accrue. The IRS is not impressed that TSIG has aspirations one day of carving out a chunk of the $35 billion c.d. music business. the IRS holds the hammer and they want their money and they want it now! And they will inflict pain and punishment on any company that fails to comply. The 5 mill. credit note that should be available to TSIG carries an interest rate of 8 percent. How can it be in the best interest of shareholders to allow these serious obligations to the IRS...A real threat to the continued operation of the company to go unpaid while allowing hugh penalties and interest charges to accumulate when the ability to satisfy these obligations at an 8% interest rate is present and available? In absence of a resonable explaination from Mr Gordon our conclusions can include those that are not so favorable, including one or more of the following: A) Perhaps the 5 mill credit line is a sham. Nothing more then a ploy to provide comfort and security to shareholders who may otherwise have bailed if the 1st qtr. earnings report was filed without a solid short term cash plan. B) Since the 5 mill revolving note contains the provision that Mr. Gordon can veto any attempt to draw upon the line based upon his sole discretion, perhaps Mr. Gordon has exercised his veto right and has denied any attempts by the company to access these sorely needed funds. "But why would Mr Gordon deny access to these funds?" 1)It is possible that he does not have the funds available. 2)Perhaps he is not as certain about the completion of the P.P. as he has reported. "Yea, but why would this be a concern. For if TSIG cannot repay him, as part of the loan provision Mr. Gordon has the option of converting the indebtedness into additional TSIG shares at 15 cents a share." However, if Mr Gordon is at all unsure about the completion of the P.P. he is no doubt also concerned about the very existence of TSIG as a going concern. What good is a boat load of .15 shares of a company that closes it's doors. C) The new "stellar" management that has recently replaced the "less stellar" management has failed to request a draw against the 5 million master note...thus failing to alleviate or "manage" this crucial issue. Mr. Gordon, In order that we may draw the correct conclusions we appreciate, request and look forward to your reasonable explanations. We would also appreciate your comments on: 1)The 5 million loan agreement contains the phrase "At no time shall the aggregate obligation of the borrower to the lender exceed $1,000,000. U.S. dollars"......Does this clause not render the "$5,000,000" meaningless?...Would it not be in practicality a 1 million credit facility?....Does it seem reasonable to you that some may view this as misleading? 2)Is the obligation to the IRS shrinking or expanding? What was the total obligation to the IRS on: a)12/31/97 b)3/31/98 c)What is it currently? 3)During Your interview with Gambler and Beebs you reported that the P.P. would be at a price significantly higher then the current share price. a)Can you narrow the focus for us on your definition of considerable in this context? b)Some of us are puzzled by that declaration. Please explain why a major investor would choose to purchase TSIG shares, that are restricted from trading for some period of time, at a significantly higher price then he could purchase common shares on the open market without trading limitations? 4)If the P.P. is completed as planned it appears insufficient in view of current obligations to carry the company beyond the middle of the third qtr. What are TSIG's plans for raising addition capital to sustain operations until profitability can be reached? 5)How will the company continue to operate if the P.P. is unsuccessful? Respectfully, JAB

To: gambler who wrote (1410)	6/25/1998 3:50:00 AM
From: JEFF BERRY	Read Replies (2) \| Respond to of 44908

Gambler, None of us want to hear rosy,fluff fluff answers from Mr Gordon. We do want to hear honest,straight forward, and candid answers to some very tough questions. To spring detailed legal,IRS and other questions on Mr. Gordon during the C.C. could very likely result in answers such as: "I am not familiar with the current amount of our indebtedness to the IRS. But I can assure you that we consider it a priority and we are doing everything possible to work with the IRS for a quick and amicable resolution of our obligations" "I am not in a position to comment on that since all of our legal matters rest in the hands of our capable attorneys and thus I am not familiar with the day to day change in the status of each of these legal matters. But I can assure you that our attorneys are working skillfully to resolve these matters in a way that brings the best value to shareholders." Answers such as these are reasonable if Mr. Gordon has not been presented with questions that require detailed answers prior to the C.C. However these same answers would be unacceptable if Mr Gordon has been allowed the opportunity to acquire the detailed facts. We will then rightfully expect detailed answers. If Mr. Gordon chooses to side step or tip toe around tough questions after having the opportunity to review them in advance, I believe this will tell us more then the answers ever could. I will thus continue to post questions for the C.C. I feel that it not only will result in the best chance that Mr. Gordon will be in a position to provide detailed, straight forward, honest answers but additionally it will help to inform others on the thread of some of the issues to be considered during the C.C. Also, posting on the thread will increase the likelihood that these issues are addressed by someone in the event that the C.C. is set up for a day or time that I am not available to participate as I have posted previously. Respectfully, JAB