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Technology Stocks : TAVA Technologies (TAVA-NASDAQ) -- Ignore unavailable to you. Want to Upgrade?

To: Judge who wrote (20659)	7/15/1998 12:15:00 PM
From: Im-patient	Respond to of 31646

Thank you, Cathleen. Your perspective is very much appreciated. Unfortunately, it is quite probable that BW knows all this already and was trying to mislead. --Fred

To: Judge who wrote (20659)	7/15/1998 5:43:00 PM
From: Bill Wexler	Respond to of 31646

<<Bill, you are so uninformed about typical credit terms that I simply couldn't let this pass.>> Yeah, it was my lack of understanding of these types of loans that led me to short Sirrom (NYSE:SIR) in the high 20s.

To: Judge who wrote (20659)	7/15/1998 6:58:00 PM
From: CalculatedRisk	Respond to of 31646

Cathleen, re:Loan. The heavy use of warrants should alarm you as an investor in TAVA. Although using warrants for low quality loans is not unusual, the quantity of warrants in this transaction is stunning! For the first $4M in loans, TAVA granted warrants for 155,000 shares at $6.25 (current value almost half a million!). In December '98 (and again in '99), if the loan is not repaid in full, TAVA has agreed to grant additional warrants (for up to 125,000 shares) at $6.25 or less, depending on the market price of TAVA. This should concern you. At my last company, our lender asked for warrants and we declined. So I have some experience in this area. You appear to have significant knowledge and experience in corporate borrowing ... have you ever seen this large of warrant grants for this size of loan? Regards, Bill

To: Judge who wrote (20659)	7/15/1998 8:27:00 PM
From: CalculatedRisk	Read Replies (2) \| Respond to of 31646

Cathleen, would you consider an interest rate of 22% excessive? That is the actual rate of interest (including the discount for warrants) TAVA is paying on the new loan! Here are the actual terms from TAVA's SEC filing: "Promissory note payable to an investment company net of a discount of $315,000. Interest at the rate of 11.5% per annum is payable quarterly." A $315,000 discount over just 9 months ... on a $4M loan! (March 27th to December 31st). And if the balance is not paid by Dec 31st, more warrants will be issued! And IMO the discount is too low. I calculate a discount closer to $500K. Have you ever seen a total interest rate this high? Regards, Bill