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Technology Stocks : Zitel-ZITL What's Happening -- Ignore unavailable to you. Want to Upgrade?

To: Bob Trocchi who wrote (17242)	10/6/1998 2:23:00 PM
From: E Rosen	Read Replies (2) \| Respond to of 18263

Here's a question that should have been asked on the conference call (unfortunately, the only people who knew about the call in time to participate were the people they wanted to hear from): This question is for Richard Ormond, President of Matridigm. Let us assume that you have the technology you claim. If you do, there are indeed hundreds of millions in potential revenue, if only you can find and convince your potential customers. It is then of paramount importance that you mount a huge sales effort, given the very limited time remaining before 2000. To do this, you need a partner with pockets deep enough to fund a sales campaign of, say, $30 - $50 million and a global sales organization in place to support it. Again, if you have the technology, it should be possible to demonstrate it to such a partner, who would be happy to buy in. Why then, instead of merging with such a partner, have you chosen to merge with Zitel, a company on the verge of bankruptcy, with a horrendous track record, and with no financial or organizational resources to contribute?

To: Bob Trocchi who wrote (17242)	10/6/1998 2:26:00 PM
From: Mark L.	Read Replies (1) \| Respond to of 18263

Good message, Bob. That might explain why they agreed to the merger. However, it would not explain why they paid so much.

To: Bob Trocchi who wrote (17242)	10/6/1998 9:03:00 PM
From: Michael	Read Replies (2) \| Respond to of 18263

<<MAT. had 9 mo. revenues of 3.8M and expenses of 10.8M>> MatriDigm has a $10.8 Mil. Operating LOSS. Therefore expenses are $14.6 mil. My take on merger is that MatriDigm insiders want to cash out. An ipo was not possible, and therefore the long awaited merger was the only option available. The results of merger will just increase Zit's bloated expenses. Since MatriDigm is losing about $1 mil. a month. Zit will have an increased cash burn. When the 10K is released,one will be able to figure out the month when Zit will be broke. With Zit dropping in price and trading volume decreasing, there is a 50/50 chance Zit will not be able to issue more discounted convertible bonds. Still shorting to zer$0.00, Sure is a Nice Day, Michael