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To: agiak who wrote (9)	12/3/1998 4:57:00 PM
From: BigRedMan	Read Replies (1) \| Respond to of 59

agiak, Taking a cursory glance at the latest 10-Q resulted in the following observations: (1) Fairly decent looking balance sheet with current ratio of ~2.54. Their current assets + restricted cash and other investments and receivables is enough to cover ALL liabilities. Not too shabby! (however, $2M of restricted investments are in $500k revenue bonds on a gaming facility and $1.5M CD securing a credit agreement for the tribe that runs the gaming facility. In other words, if the gaming facility goes belly-up, soyanara to $2M!) (2) Revenues from their primary source decreased by over 21% for the last 12 months. Their "other" revenues from a couple of subsidiaries (which consisted of website development, marketing and consulting) accounted for 7% of their revenues. The dramatic decrease in revenues accompanied by a 55% increase in administrative expenses is alarming. (3) The dilutive effects of certain transactions on shares outstanding is significant. Stock options and shares issued have resulted in a 23% dilution over the past twelve months (admittedly, a significant share of the dilution is attributable to the acquisition of Cyberworks). (4) The consulting revenues appear to be solely attributable to a single agreement with the Barona Tribe. Although the agreement is a 60-month extension of a former agreement, all the eggs appear to be in one basket, one might say. (5) The company has received over $2.5M in fees related to future consulting. Although these fees have been properly treated as not recognized yet, they have not yet been earned. (6) Although there are only 4.7 million shares outstanding, there are over 100 million shares authorized. Again, potential for dilution is significant. I am not familiar enough with this company to pass judgement on its management or the management's strategic vision. IMHO, that is THE key to whether or not this company is going places. I might take a little closer look at it. GO BIG RED!!!