To: Riley G who wrote (21327 ) 3/14/1999 1:56:00 AM From: TideGlider Read Replies (1) | Respond to of 26163
Correct! Your image hasn't changed..napeague.com I FEEL THAT THIS IS A STOCK TO AVOID AT THIS TIME. As a "soap-opera" this one has everything - a heroic new management team, evil "naked shorts" and equally evil market-makers who are trying to drive the price of the stock into the ground, a mystic named "Riley G.", and a herd of followers of this mystic, who have formed what they call "the cartel" to fight these evil "naked shorts". The members of "the cartel" also fervently believe that OVIS is going to be a $100 stock in the next week or two - it is currently trading around $1.50 a share. On second thought, this sounds more like Peter the Hermit and the Children's Crusade. To keep you from wading through several thousand posts on SI and other boards, let me recap the story to the best of my ability. OVIS's market price has been dropping steadily for over a year, in spite of a 30 to one reverse split in January 1997. By May it had fallen to around $.25 per share, largely because of its almost non-existent revenues and earnings. In fact, the company's accountants have indicated in their audit report that there are significant doubts as to OVIS's ability to remain a "going concern" (ie, avoid bankruptcy). In the May 1997 issue of Equities magazine, OVIS was described as making great progress toward becoming a viable business, but was also portrayed as beleaguered by "evil short sellers" who are trying to turn it into a "lifeless battered shell of a company with no hope of revival". Earlier in August, a gentleman who calls himself Riley G., and who identifies himself a "psychic detective" (and has a web page dedicated to this role), discovered OVIS, and declared war on the "naked shorts". Since then it appears that he has mobilized a group of followers and formed "the cartel" who are asking their brokers to convert their "street-name" shares into certificate form, so as to take them out of the hands of the "evil shorts." They believe that this will force the "evil shorts" to pay anything...absolutely anything...to buy back the shares that they have shorted. Hence the anticipated high share valuations. Now, I don't have a lot of facts to add to "enrich" all of this, and I really haven't researched OVIS in great depth. However, it does appear that there are a lot of shares in float, compared to the number of shares outstanding. So where did these shares come from? Riley G. and "the cartel" believe that these shares are the result of short-selling. And they believe that, by demanding that their shares be converted from "street-name" into certificate form, they will force these short sellers to buy back the shares at inflated prices. Well, there are a couple of other sources for these shares. One of the sources might well be the S-8 Registration of 2,000,000 shares on April 4, 1997 for the purpose of registering shares for the Employee Stock Option Plan. The Equities article states that these shares will go to the two key "insiders" in lieu of other compensation. Another possible source of a large number of shares coming onto the market is an offshore Regulation S sale - OVIS under its current management team did this back last fall, and the company appears to be in desperate need of cash. Now, if this really is a classic "short squeeze", and these are very rare, there are several potential outcomes. One is a SEC-mandated trading halt while the situation is sorted out. Another is a quick run-up, while the shorts cover their positions, followed by an equally quick decline, when "the cartel" discovers that they have over-played their hand. Also, there is a strong likelihood that many of the recent trades would simply result in "fails" and thus be negated. Net-net, "this is no place for a country boy...." Right now, the intensity and level of passion, pro and con, on the SI Forum for OVIS is really frightening. "Riley G." has previously warned that the "evil shorts" will try to infiltrate the OVIS Forum, and persuade members of "the cartel" to sell their shares. Thus, anyone who questions the underlying beliefs of "Riley G." and "the cartel" is immediately howled down. TG