Finally some good news - someone actually wants to give Tad some money. Let's hope the management play this correctly and do not draw upon Gem too much until the sp has recovered, preferably to 12p+.

MARKET TALK: Tadpole Tech Frog Leaps 15% On Contract Win
1212 GMT [Dow Jones] Tadpole Technology's (TAD.LN) new contract win will drive forecast upgrades says Evolution. Analyst Lorne Daniel says contract "demonstrates revenues beginning to come through from streaming application business." Reiterates add on co, as "not enough visibility yet to push it to a buy." Tadpole +15% at 7.9p. (PAB)

M

pach
I think the whole point is this contract negates the need for GEM now.

no it doesnt!! this contract hasnt just sprung up from nowhere - if this contract could pay the bills thn they wouldnt have negotiated GEM surely!!

Have to agree with rjs - but with the contract becoming a reality it might defer the bulk of any drawdown until later in the year (by which time the sp is higher?). Grasping straws probably.

pach
You might agree but I think the chances are very high that rjs is wrong, this contract, even though tad knew about it last week, would not be taken into account for forward purposes therefore the accounts would not be able to be signed off, therefore funds had to be put in place, the quickest and easiest way and initially the cheapest would probably be GEM hence the announcement.
You only have to look at the funds coming into the streaming division along with Cartesia's profits to realise they don't have a funding problem now.

Also benefiting from a new contract announcement were shares in Tadpole Technology, which added 1.25p to 8.125p. It said that subsidiary Endeavors Technology had executed an agreement with an OEM valued initially at 2.8 million dollars, comprising licenses, royalties, support and maintenance services of the Endeavors AppExpress software-streaming platform. The amount due during the current fiscal year ending 30 September 2005, relating to licenses and support services, is $1.6 million and an initial payment of 600,000 pounds had been received.

Yuff - we will have to agree to disagree. I cannot accept your explanation of events for the following reasons: (i) if Tad "knew" about the contract last week they would have halted any finalised Gem deal pending conclusion of the OEM agreement - esp as they would have known that the sp would be hit very hard, (ii) if Tad were optmistic about future revenues then they would not have signed any Gem deal - certainly not in the foreseeable future, and (iii) Tad claimed that Gem was simply insurance last time round because they were optmistic about securing deals - and we all know what happened. Clearly OEM is important news, although irrelevant if other deals are not secured in the next couple of months. I continue to hold, although I did halve my holding in Dec. I used all of that money to re-purchase at an ave of 7.28p so at least I have more shares for the same outlay - not that it helps if Tad go belly-up! Best of luck to all holders.

pach

LSE rules state that full year results have to be published within 120 days of the year end, in tadpoles case last friday the 120th day, how would the auditors of signed of the accounts if the SB money had been delayed slightly and nothing to replace it.
I can't accept tad could have said to the auditors its ok honest we are about to sign a $2.8m deal which will cover the shortfall and we will get $600k as soon as it is signed, ok David we'll take your word for it but you have to promise you will sign this deal otherwise we are guilty of mis - represenataion to the LSE.

All, FYI.

An OEM deal of this size will have been in the works for months. Not less than two months, IMHO. The announcement fails to say who the OEM is, which would indicate that the whole thing has not yet gone through approval at the other end. The contract will contain a clause (they always do) that all publicity must be agreed prior to release by both parties.

This announcement smells a little of a hurried release by TAD who have just got a signature but not yet got approval from the other party for PR.

MM - only partly agree. The rns states that a payment has been made.

Yuff - you miss my point - I was not concerned with the auditor's issue - simply with the need to negotiate a deal with Gem. The two are related but the accounts (for the last year) could have been signed off without any mention of/ or signing of a deal with Gem (for this year). Clearly, therefore, the OEM payment is not sufficient to keep Tad afloat - it also needs Gem - what black-hole have they fallen into? But I hold and await further events - best of luck to all holders.

Three points:-

1. The contract has been signed and must, therefore, have been approved by the OEM whether or not the PR wording was agreed before the RNS. The customer's name wasn't mentioned, so no problem.

2. The accounts from last FY could have been signed off for the results announcement, but the auditors could not (presumably) have agreed that Tad had sufficient funds to continue its business without the GEM facility being in place.

3. The point about the auditors being the crucial factor in the requirement for the GEM facility is well made. That facility would also provide the necessary assurance to the OEM that Tad was in a position to fulfill its side of the contract.

pachandl:

A payment would typically be due on signature. Most OEM agreements have gagging clauses which specify no publicity until mutually agreed.

So they signed, got the on-signing payment and still can't say who it is. Perfectly normal.

There are deals which have permanent gagging clauses as well.

MM - I accept your point - I was simply saying that as a payment had been made there must have been a signed contract - you had previously implied that this might not yet have happened (your comment ..." which would indicate that the whole thing has not yet gone through approval at the other end"). Anyway, we seem to both agree so no problem.

Indie - thanks for your response - I assume you are correct although you do use the word "presumably" in pt 2. I am hoping to speak to someone with auditing experience next week to confirm this - although I am sure you must be correct on pt 3 anyway, so it is pretty much academic.

A bit disappointed that we finished in the red - but that's Tad for you (or their MMs).

Posted by RT on another BB, gives you a few hints about the future. This is not the full post but it is a fair description of the state of play.

M


This brings me onto the future.

Negativity is a good thing. I have learnt to accept it. It is healthy and last week there was no one more negative on Tad than me.

I stated that I wanted to see revenue. An RNS with $$$ attached. It is something that all of the Tad supporters have craved since we bought ETI. This is the most significant development in the ETI era we have had. It has proved once and for all that ETI can produce and sell multiples of the product. It seems likely that it is the Wyse embedded deal that was stated earlier (or yesterday, I forget)

It is also rumoured that MS have had better than expected results from the streaming trials. EDS & MCI must be close although I think April is a target date??

I have heard a brief rumour that I cannot substantiate that Veritas is another Telco that ETI may have done a streaming deal with. A while back I heard that there was a deal as big as SB was supposed to be.

Has anyone heard this?

Whilst it is still possible for Tad to drop I reckon yesterday was a major turning point.

Any views?

ML
I think the company on iii being discussed now is verizon.

Cheers Yuff. Verizon, Macrovision or BT i dont really mind who it is
as long as they buy Streaming from us.

M

pachandl: You're right. That's what I meant to say. Apologies.

Pach,

I said 'presumably' because, although I know the auditors have to assert that the company is an on-going 'going concern', I had no idea what cash was available when the results were announced.

Frankly, not being an accountant, I would not have had much certainty even if the (then) current cash position were known. The question of pay-offs to the various departed staff could easily pox up the most finely-tuned financial analysis as could the precise timing of any purchases against the signed contracts.

Do we assume a new PR company is desirable, necessary and cost-effective?

Indie - I assume your last comment was rhetorical!!!!