COLORADO SPRINGS, Colo. , June 30, 2004 (PRIMEZONE) -- Maximum Dynamics, Inc. (OTCBB: MXDY), a projects management and back office services company with subsidiaries focused on technology solutions, mobile logistics and wireless communications, announced today that it has filed an SB-2 registration statement with the Securities and Exchange Commission (SEC). In the filing, Maximum is registering shares in its Standby Equity Distribution Agreement with Cornell Capital Partners, L.P., a Delaware limited partnership, of Jersey City, New Jersey.
The decision to sell common stock to Cornell is entirely at Maximum's discretion and there is no obligation for Maximum to sell any of these shares to Cornell. The equity line does not contain any minimums as to amount or frequency, except that Maximum can only draw down once every seven trading days. Once the SB-2 filing is declared effective by the SEC, Maximum may begin to draw down upon the equity line should it choose to do so. At the expiration of the equity line, any unsold shares will be returned to Maximum's treasury. Management has been advised by the legal counsel who filed the company's registration statement that the process typically takes between four and six months before the SEC declares the registration statement effective.
One reason the company sought this equity line is due to the demand for its real-time tracking and asset management solution, TagNet. Management has had discussions with funding groups who are interested in funding any purchase orders the company secures for TagNet. However, for contracts that have a pilot project component up front, most banks and asset based lending groups prefer to wait until the pilot project phase is completed. In cases like these, management believes that access to its equity line will prove handy.
"Based on the feedback we have received from our shareholders, we believe there is a misunderstanding about our equity line with Cornell and wanted to clarify some of the issues," said Maximum's CFO, Joshua Wolcott. "We understand investors have questions about the number of shares registered and the corresponding dilution this represents. However, we wish to assure investors that we do not intend to draw down on the full number of shares registered unless there is some advantage to doing so. Rather, we see this financing as one option to have available to us in the future. With the recent addition of Startrack as a joint venture partner and the current demand for TagNet, we are planning on ramping up for production of tens of thousands of TagNet units over the next twelve to twenty four months. Add to this, the infrastructure we have built to support roll-out of our projects in four continents around the world and it becomes evident why we put this financing in place. I believe it may be an important funding piece to have in the future should we need to draw upon it."
The other reason management proceeded with an equity line is to have fast access to capital in order to quickly pursue opportunities that arise. "Another great example of why we want this equity line financing in place is illustrated with our mobile point of sale business," added Wolcott. "We are securing agreements with back end providers in the pre-paid voucher market sector that enable us to capture a percentage of the back end revenue from each transaction conducted on a mobile point of sale terminal that we sell. From time to time, opportunities arise wherein if we are able to quickly finance terminals we can negotiate the sharing of front end revenues that are generated as well. We currently have such an opportunity with 300 terminals in Africa. However, we are finding that the banks and other funding groups are taking too long. In the future, it would be nice to be in a position where we could finance some of it ourselves, demonstrate viability and push the banks to quickly fund the rest."
Maximum Dynamics is a projects management company that utilizes a fully functional back office located in Cape Town, South Africa to manage business projects. It currently has 26 projects that it is managing either as the direct project managers, relationship managers, or deal brokers in four continents. These projects include mobile logistics and radio frequency identification (TagNet), mobile point of sale solutions (including pre-paid services), village banking, business process management, enterprise application integration, supply chain management and procurement, back office services, wireless Internet communications in urban and rural settings, commodities trading, alternative fuel and economic development businesses.
For more information on Maximum Dynamics, visit the company's website at http://www.maximumdynamics.com.
This press release may contain forward-looking information within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, and is subject to the safe harbor created by those sections. Maximum Dynamics assumes no obligation to update the information contained in this press release. Maximum Dynamics' future results may be affected by its ability to continue to provide solutions for its projects on which it currently works, its acquired real-time tracking technology, its acquired distribution rights for technology solutions it utilizes to service its projects, its dependence on procuring highly competitive logistics, point of sale, banking and energy contracts, its dependence on hiring and retaining qualified professionals, potential fluctuations in its quarterly operating results, its dependence on certain key employees and its ability to timely and effectively integrate the businesses it may acquire.