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Microcap & Penny Stocks : THNS - Technest Holdings (Prev. FNTN) -- Ignore unavailable to you. Want to Upgrade?

To: JOHN WHITE who wrote (10010)	1/9/1999 3:47:00 PM
From: Wally	Read Replies (1) \| Respond to of 15313

John: I totally agree with you about the potential pluses of an expanded share count. IF in fact FNTN is very close to looking attractive to the larger investment community (especially Mutual Funds) they must have enough shares to accommodate these people. As my friend at Smith Barney said, when it comes to investing in a little BB stock, large brokerages (et al) are (usually) immediately scared off by 2 things. 1. That it IS a little BB stock and therefore too high of a risk to fit their criteria. 2. That if they buy too many shares the brokerage will end up owning the company by accident (and they're not in the ownership business - believe me). So having enough available shares is absolutely essential to the growth of a company IF they are in fact growing. A truly stagnant company (or unhealthy one) often doesn't benefit from raising cash in this manner. In FNTN's case, the historical buying patterns in the company, the low burn rate and the buzz of positive activity (and rumor) all strongly suggest that management has made a smart and timely move. Waiting until after FNTN is "discovered" to print shares would totally destroy the momentum of the stock. If FNTN is an embryonic Broadcast.com, or has even 1/50th of the potential, I would suggest to MS that he buy a faster printer ! He's going to need it. Wally

To: JOHN WHITE who wrote (10010)	1/10/1999 9:51:00 AM
From: De Peepster	Read Replies (2) \| Respond to of 15313

heyy John, That would be accurate if FNTN was not a BB issue. At most at this level you can attract venture capitalists and private placements, both being in essence the same thing. The net result is issuance of shares below market, often rewarded with interest, that end up on the open market creating dilution unbeknownst to the average shareholder when a company is not fully reporting. It is a method of raising funds that is used for startups when financial institutions will not offer financing. The risk for the shareholder and hence the challenge for the managemnet is can they deliver a marketable product before dilution cripples the future outlook in a reasonable timeframe. FYI,, B