Safeguard Security Holding (fka SSHSQ)

[hardlesson]

Ponder these links concerning debt:

1. Debt listed in "Letter to Shareholders."

http://www.safeguardsecurityholdings.com/newsletter.pdf


"At the time of the change of the board of directors, the
company was in technical default with its primary secured bondholder and the
relationship with the Company was rapidly deteriorating. The new board has cleared up
the defaults, and has revived an excellent working relationship with the senior secured
bondholders.
To stabilize the company, the board arranged for additional funds in excess of
$1,000,000 that has been invested in the company, which has come in over the past 15
months. This capital injection was necessary to take advantage of various new contract
opportunities that the company was presented with. While there are many opportunities
for the company, most projects require a capital investment of significant size before
there is a return. It is the boards desire to pay down the outstanding convertible debt to
the senior secured bondholders at such time as cash flow from the various new
contracts allows for it."

2. And what do you make of this debt on the "Financials?"

http://www.safeguardsecurityholdings.com/financials.pdf

Subordinated Debt - Convertible Debenture $1,719,445

3. And this debt from a recent PR?

http://dallas.citybizlist.com/16/2010/12/3/Safeguard-Secures-Additional-Working-Capital.aspx

"announced today that the company has secured an additional $1.5 million of financing from its existing investors and a new working capital line from Meridian Working Capital. The combination of equity, debt and working capital enables Safeguard to expand its business platform and to capitalize on new opportunities in both of its consumer and enterprise markets."



Therefore: The debt is the story here, convertible debt. Not the Revenues, the Employees, or upcoming Contracts.

Long term Optimism once the debt is paid...short term...trade only carefully.

The above links are not really needed to substantiate the problems that SSHS has been enduring. In addition, all this really does is echo the comments of Smilin_B and liable that have been already repeated here many times.


In my opinion of course. (Underlines above are mine.)

hl