I've recently asked for the logic in Turley's buying the warrants from S/L given the uncertainty over future IP cashflows. I've also been confused about his worry about the "overhang"

Some were outraged at my audacity and told me to sell. I of course luckily listened and then not wanting to be totally out of a stock that I've been in since 2000 I decided to get back in in a relatively small way. This of course required that I get my question answered or sell the shares I recently purchased.

My problem was taht Turley was worried about the "overhang". This made no sense since that really shoud not effect the ceo or the company. It ceratainly made little sense to remove the warrants by using cash and it certainly made little sense for S/L to sell at these lower prices would they have a strong feeling that a Texas win was probable.

The warrant transaction would need to be a win-win for S/L. That is it would need to help PTSC in a real economic sense ( that is excluding agora nonsense) and be long term beneficial for PTSC and therefore allow S/L to sell its other holdings at higer prices even in a sans-ip-windfall environment.

So here's what I believe.

PTSC needed to buythe warrants so they could use their shares as currency in an aquisition and maintain their cash position. Due to the anti-dilutive covenant enjoyed by the warrant holders issuing shares created a virtual endless loop/catch-22 that pracically precluded the possibility of purchases.

Should PTSC issue more stock in an aquisition the warrant holders would be entitiled to an amount of shares that would maintain their percentage of possession.

So, should PTSC actually be looking to do a deal of some substantive size, having the warrants outstanding would be quiet disruptive. PTSC would issue shares (deal currency) to the aquiree. This (**)would create a dilution to the warrant holders that would need to be cured via the issuance of additional warrants. This in turn would cause a devaluation of the shares issued to the aquiree that in turn would cause PTSC to give the aquiree more shares to maintain the same value prior to issuing additional warrants. This would then ( please go back to the ** or if you've done this more than twice go to the next paragraph)

So this is what TURLEY meant by the overhang.

PTSC IP windfall IMHO may ever happen again. But PTSC has given over control of that to TPL and nothing they can do either way. Ergo TURLEY needs to foucs on growing PTSC. Since the company has no inner strengths organic growth is not possible (barring a sudden need for JAVA chips) and PTSC must now look outside its current "box' for growth.

This is good and bad.

Good because tech stocks are relatively depressed and PTSC might become the new cmgi ( I refer to the heyday) taking stakes in embryionic technologies and bringing these companies public in under 3 years at much richer valuations

Bad because at this stage of the game PTSC has an intrinsic value of 10 cents per shares. ( give a nickel for the IP gamble, 1 cent for Holcom and 4 cents remaining per share post warranty aquisition and assumming hopefully a cessqation of idiotic dividend distributiuons)

The question going forward then is whether Turley can diffrentiate between good technology and commercially viable technology.

Can Jim cull the young buds from the bush without getting stuck too bad by the thorns.

20 million is a lot of money these days when buying underdeveloped technologies. It's even more if you can create currency in the form of share issuance.

My guess is that the next steps will include an announcement that stock buybacks and dividends will end and be reinstated upon PDS distributions. Once S/L reduces its stake a reverse split and concurrent nasdaq listing would be a wise choice allowing for the entry of "smart money" and pension funds further strengthening thestock price and rducing the number of shares to be used as aquisition currency.

PTSC is crossing over thethreshhold of new beginnings. I'm just not sure how large of a bet I'm comfortable placing at these prices. I'm fine technically but should we breakdown and close below 43 cents cheaper shares will be available to all.

Hope something good comes out of texas to to make that nickel worth a quarter if not I'll just buy more at much loer levels.

Well that's all I got

Cheers