Cobs NSS Solutions

[Hilander]

STUDY #1 (PHEI)
OK, I have one company to report on. Here’s the snapshot of the situation. I don’t know yet if they were financed privately through convertible debentures. They report having spent $30M on R&D. Lets see what we can collectively learn from this exercise.

Phantom Entertainment Inc. OTC BB: (PHEI)
Market Cap. = $ 4.4 M
Shares Outstand. = 945.4640 M
Friday’s Closing Bid = 0.0048
Volume shot way up 2 days in a row this last week. Why? Are the shorts covering their positions?
Thursday’s 11-30-06 Trading Volume = 50M+ shares
Friday’s 12-1-06 = 126,526,417M shares traded

(PHEI) Market Makers Level II Quotes:
LAST=0.0049
HIGH=0.0055
LOW=0.0031

MPID………..…...BID…………..….ASK

HDSN …………..0.0048…………....0.006
UBSS. ………..…0.0047………...….0.005
SBSH…………....0.0045……...…….0.005
NITE………….....0.0045…………….N/A
DOMS…………..0.0042…………….0.0055
SSGI………….....0.0041…………….0.0058
SALI………….....0.004..……………..N/A
HILL..…………...0.004……………...0.0055
FRAN…………....0.004…………..…N/A
ETRD…………....0.004……………...0.006
VERT.…………...0.004………….......0.007
QUIN…………....0.003…………......N/A
SEAB…………....0.003……………...0.007
VFIN………….....0.003……………...0.006
GARC…………....0.003…………......0.0075
ABLE………….…N/A……………....0.006
PERT………….…N/A……………....0.0065

STOCKCHART: (formation looks like it’s may be ready to bounce)
http://stockcharts.com/h-sc/ui?s=PHEI&p=D&b=5&g=0&id=0

OVERVIEW:
Developing and seeking to commercialize the Phantom Lapboard, a wireless, rotating custom keyboard/turntable with integrated mouse pad. We have not yet generated any revenue from operations. Our ability to generate revenue in the future is dependent on our ability to successfully develop and commercialize the Phantom Lapboard. We still retain assets with respect to the Phantom Game Service and when various milestones for the manufacturing of the Phantom Lapboard are completed we may shift more of our focus to the Phantom Game Service. The Phantom Game Service is anticipated to be the first end-to-end, on-demand game service for delivery to the living room.

Phantom Entertainment, Inc. has been on the OTCBB Naked Short Threshold list 6 times. Brokerage firms have been out of compliance with Regulation SHO twice.

From January 2005 to November 2006, approximately 2.6 billion total aggregate shares of PHEI have traded for a total dollar value of nearly $219.4 million. The total aggregate number of shares shorted in this time period is approximately 196.8 million shares. The Total Short Interest reported on October 10th, 2006 is 28,954. The PHEI Squeeze Trigger price of $0.086 is the volume weighted average short price of all short selling in PHEI. The first of several short squeezes is expected to begin when shares of PHEI close above $0.005, where approximately 17 million shares of PHEI have been shorted.

Definition:
Squeeze: A market situation in which the lack of supplies tends to force shorts to cover their positions by offset at higher prices. Period when stocks or commodities futures increase in price and investors who have sold short must cover their short positions to prevent loss of large amounts of money.

WHAT’S IMPORTANT HERE? (See any similarities to UNICO)
• It appears PHEI like UNICO weren’t able to do anything about the NSS problem until now.
• It appears both companies are ready to take off in 2007 and leave the shorties in the dust.
• Watching and waiting for these companies turn-a-round: Once the company establishes squeeze trigger prices, is this a good indication that they are about to rebound? If so, it appears to be their only defense against defeating the naked shorts?

THE GOOD NEWS:
1. SqueezeTrigger price of $0.086…(as stated above)
2. The first of several short squeezes is expected to begin when shares of PHEI close above $0.005…(as stated above)

Observations:

How does a short squeeze relate to PHEI, UCOI or any other company in a similar situation?
From my viewpoint, it appears that once the company establishes the squeeze triggers, that gives us investors a target to watch the shorts run for cover.

AS IT LOOKS TO ME, PHEI AND UCOI ARE POSITIONING THEMSELVES TO LEAVE THE SHORTS BEHIND IN 2007?

COMMENTS AND CONCLUSIONS:
This is all I have to report and have nothing else to say. Is there anything else to learn from this example? Does anyone see anything else that will help in analyzing this naked short situation? IF SO, for easy access in the future, please start your post with the heading:

PHEI (Comments & Conclusions)

Thank You,
Hilander