CYOE's fraudulant press release on 10/6/98 fails to state that over 90% of sales were to Comdisco and the 20% downpayment for the sale to happen was provided by up front warrants that CYOE had provided these companies that CYOE was getting a equity interest in.
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Coyote Network Systems Anticipates Record Q2 Revenue; Expects To Be Slightly Profitable; Completes INET Acquisition
Sequential Revenue Increases More Than 100%; Book-to-Bill 3:1; Raises $7 Million from Single Institutional Investor
Westlake Village, CA – October 6, 1998 – Coyote Network Systems, Inc. (OTCBB: CYOE) today announced it anticipates sequential revenue growth of more than 100% for the second quarter of fiscal '99, ended September 30, 1998, and it expects to be slightly profitable. Revenue for the first quarter of fiscal 1999, ended June 30, 1998, was $7.2 million. Revenue for the second quarter of fiscal 1998, ended September 30, 1997 was $106 thousand. Revenue for all of fiscal '98 was $5.4 million. The second quarter telecom equipment book-to-bill was more than 3:1. The Company expects to report complete results for the second quarter as soon as they are finalized, but not later than November 15.
"We continue to see substantial demand for our switching products, primarily to new emerging competitive international long distance carriers," said James J. Fiedler, chairman and chief executive officer, Coyote Network Systems. "We plan to leverage our technology to help position our Company as a leading provider of affinity based, international long distance services. Although the majority of the second quarter revenue was still from equipment sales, we expect network services to grow faster and to be substantially larger."
The Company announced it had completed the acquisition of Interactive Network Systems, Inc. (INET), a competitively priced, provider of quality international long distance services to high volume, commercial and residential "affinity" groups. Headquartered in Los Angeles, CA, INET markets international long distance services to more than 17,000 customers, primarily to French and Japanese affinity groups. INET, with 1997 revenues of $6 million, has doubled its revenues in each of the last three years.
The Company also announced it had completed a $7 million equity private placement with a single institutional investor. Under terms of the agreement, the Company completed the sale of 700 shares of 5% Series A Convertible Preferred stock and a warrant to purchase up to 225,000 common shares. The net proceeds of approximately $6.3 million are to be used for acquisitions, working capital, and network expansion.
About Coyote Network Systems
Headquartered in Westlake Village, CA, Coyote Network Systems (CNS) provides telecom equipment and network services that enable and deliver local, long distance and Internet services. Coyote Technologies provides scalable Class 4/5 telecom switches and IP (Internet Protocol) gateway systems. Headquartered in Houston, TX, American Gateway Telecommunications provides international long distance services to carriers. Headquartered in Los Angeles, CA, Interactive Network Systems markets international long distance services to more than 17,000 customers, primarily to French and Japanese affinity groups. CNS is authorized to provide competitive local exchange carrier (CLEC) services in California. For more information, please visit the Company's Web site: cyoe.com, or call 1-818-735-5312.
The statements in this news release may be considered "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and involve known and unknown risks and uncertainties, which may cause the Company's actual results in future periods to be materially different from any future performance suggested in this news release. Such factors include, but are not limited to, actual and potential competition, risks associated with consolidation in the industry and with international expansion, general and economic conditions, the need to manage growth, and certain product, technology and regulatory risks. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof. The Company undertakes no obligation to publicly release the result of any revisions to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. For more complete information, please refer to the Company's Form 10-K and Form 10-Q filings with the SEC.
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