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Technology Stocks : Totally Hip Software, What is in store for it? -- Ignore unavailable to you. Want to Upgrade?

To: MSB who wrote (490)	8/23/1998 3:32:00 PM
From: David M. Lomow	Read Replies (2) \| Respond to of 756

First off, I have no idea if this is the kind of limited partnership that is involved here or not, but the very mention of an LP raises a red flag in my books. Let me outline the probably scenario. Until about four years ago, the Canadian government had a tax-shelter in place that allowed for the formation of limited partnerships to raise investment capital in specified areas. The goal was to promote the development of certain Canadian industries such as feature film production, oil and gas exploration, and yes SOFTWARE DEVELPMENT.. The basic idea was you sell shares in a limited partnership that allows its owners to take substantial accelerated tax write-offs based on potential future earnings. Investors lower their present tax burden, companies get investment capital, and the government helps promote certain areas of business that it hopes to foster. The problem lies in that many of these limited partnerships were little better than tax-writeoff scams to allow rich doctors and lawyers to pay less tax. All you needed was a business plan that said your software or video game had the potential to make millions of dollars, and an appraisal from a CPA (for a generous fee and or stock Options), and someone to sell and market the product to the appropriate investors. Simple, except most of these companies never earned dollar one, and some never even managed to come up with a marketable product. ALl that was left at the end of the day was the already accounted for tax write-off There were hundreds of millions of dollars worth of the LP's sold in the early to mid nineties before the government closed the loophole. There is still some question about whether Revenue Canada (the CDN IRS) will eventually re-audit a number of these software LP's and deem them inappropriate, leaving most of there investors with huge back-taxes to pay. Now some of these LP's went on to do exactly what they said they would do. Create software, sell it and make money. MOST DID NOT. This is why the government closed the loophole. There were some very shady characters involved in this business, and they got very rich. It seems that Totally Hip is Totally Legit, and sells a viable product and has a viable business. Whether or not they used this method of financing or not remains to be seen. If they did, I would be interested to know what the current position of Revenue Canada is on these Software LP's and whether or not THP has made any provision for potential Tax rulings. Good Luck DL

To: MSB who wrote (490)	8/24/1998 4:20:00 AM
From: Bill Ulrich	Respond to of 756

Hi MSB, so I'm trying a few tests here. Seems fair to build a few animated gifs in some competing products such as GifBuilder and Gifmation. To be fair, I'll use a demo version where available since I don't have a full version of WebPainter available to me. Demos typically have restricitions. Gifmation's restriction is that you can't make anything larger than 3 frames. WebPainter's restriction is that it sticks in a grey text watermark that makes your file size larger than it normally would be. I decide to make a simple 3 frame animation of some text. Since WP adds the watermark, I'll export the 3 frames as individual picts. That way, the other programs will have to deal with the watermark, too. Any of these programs can take in a series of pict format images and spit out an animated gif. Since the other programs have to deal with the watermark already embedded in the pict file, I'll make WP do the same. Will it add an extra watermark? Well, if it does, it should overlay the grey text watermark on top of the other pixels. In other words, where it writes in grey, "Webpainter 3, Register today!...", it should just put the same grey pixels in the same place on the screen. Shouldn't affect anything&#151and after a run-through, that's precisely what it did&#151it put the same grey pixels in the same place, so the test should be fair. All three programs will have to deal with the watermark and my text input (black on white). (...continued...) -MrB