Today's News, page-25

@Martin Gifford

Tata renegotiated deal was announced to the ASX on 1st August.

The Q&A didn't occur until 10th August.

In it addressing Investor concerns regarding the lack of financials of Syntonic Wireless Inc in the June quarterly report & the re-listing documents Gary specifically said no cap raise was required in either the short or medium term (unless for an acquisition).

So they knew exactly how the new Tata deal would affect them financially going forward before Gary made those comments.

They had A$2.7M in the bank at end of September & listed expected expenditure for this quarter to be all of A$450,000 (doesn't take into account sales revenue). So on the surface everything looks fab & even if there was no income stream they had enough cash to last over 1 year on that burn rate. Tata would be due them some money anyway within a year & they pay part of the Syntonic development cost's as well as all there white label costs.

That's why this announcement is such a shock & the timing is terrible to say the least with so much news expected in the rest of November.

If Wednesday's announcement in anyway says something along the lines of "due to overwhelming demand from investors, the company has decided to increase the size of the placing to X million shares raising A$X" then run for the hills, because that means without a doubt the current business model is not working, its flawed, otherwise no-one in there right mind would accept additional capital at such a crap share price, when I clearly showed with very conservative assumption how cash-flow is going to quickly develop.

Here's a link to the post so you can view it yourself = Post #:20575361

As you know markets hate uncertainty and when a company say to the market I don't need money in the short or medium term & then come back just 3 months later & does a discounted cap raise on a significantly falling share price, the market will never take there word again at face value it will always question it. Trust has been broken & the long term cost of that between the company & the market is significant.

LOTM