stock ticker: HEB

Hemispherx Biopharma (AMEX: HEB)……Can You Believe?

At the risk of beating a drum that we have all heard one too many time, what is going on with Hemsipherx Biopharma? (AMEX: HEB). Hemispherx has been the piñata for short sellers for some time now, and it seems for due reason.

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Does Warp Technology Have a Warped Market Cap?

How Bout’ These Bubble Type Numbers?

Market Capitalization- $89.86 million
http://quote.bloomberg.com/analytics/bquote.cgi?version=markets99.cfg&view=extmult&ticker=wrpt&x=10&y=7

Six Month Revenues- $11,000

*Note- throughout the report, anything in italics is a direct quote from the annual 10KSB filed on 10/7/02. Below is a link from 10k wizard. For a free link you can go to the SEC Edgar Website.
http://www.10kwizard.com/filing.php?param=repo%3Dtenk-sym%3Dwrpt-sdate%3D20011013-edate%3D20021013-st%3D2&repo=tenk&ipage=1877192&doc=1&total=&g=&type=&trad=&attach=on

It Once Was A Good Idea

Warp Solutions was founded in December 1999. Remember the glorious days of December 1999? The NASDAQ was trading at 4,000, about to make its last surge up, and the country was worshiping that sock puppet that we all thought was so amusing. Well back in those days people believed that caching technology was the holy grail and Wall Street threw a lot of money towards companies that were designed to make the internet faster. Around the same time Morgan Stanley put money into Warp Technologies, they brought public CacheFlow in an IPO in which Morgan raised over $100 million.

And Then Reality Set In

In August of 2002, CacheFlow changed their name to Blue Coat Systems is order to rid themselves of the negative sentiment towards caching technology, as the company was trading BELOW cash value. The CBS Marketwatch article below sums it up as it states, “as companies that offer caching have gone from hot to very cold.”
http://www.marketwatch.com/news/yhoo/story.asp?source=blq/yhoo&siteid=yhoo&dist=yhoo&guid=%7B48C31FD2%2DA0BC%2D41E0%2DB367%2D9F04D54E0E20%7D

The Caching business is extremely competitive with Warp must compete with companies who are far better capitalized and who have current customer bases. As Warp submits in their annual filing,

“Many of our competitors, including some of those identified above, have been in business for a number of years, have established customer bases, are larger, and have greater financial resources than the Company. There can be no assurance as to the degree to which we will be able to successfully compete in our industry.”

Misleading Press

All of Warp Technologies press releases describe the company as “a leading provider of internet application acceleration solutions”. This line could not be further from the truth. How can they be a leading provider when in their filings the submit,

As of June 30, 2002, WARP had completed the sale of one unit to a channel reseller as part of its distribution agreement with that reseller.

Does this sound like a leading provider or a company in its infantile stage?

Additionally WARP is in the very early stages of developing its customer base. As of June 30, 2002, WARP had completed the sale of one unit to a channel reseller as part of its distribution agreement with that reseller. As of September 30, 2002, WARP had signed agreements with two additional customers. WARP is currently dependent on those two customers for its revenues.

Because the Company was formed in July 2000 and WARP was formed in December 1999, we have a limited operating history. Such limited operating history makes it more difficult to predict whether or not we will be successful in the future. Our future financial and operational success is subject to the

WARP 2063 Is Still In Development

Warp technologies flagship product is still in development.

“At present, the WARP 2063 is still considered to be an early stage product. WARP believes that the product will require at least an additional twelve to twenty-four months of customer requested feature enhancements to reach maturity.”

Why Pay Market When You Can Buy At .25 Cents

Warp recently raised operating capital through a series of equity investments. Who is the investor who got such a great deal? This new investor owns twice as many shares as the CEO, but the company does not disclose his/her identity.

Subsequent to the closing of the Share Exchange, the Company completed the sale of 10,364,408 shares of its common stock, after giving effect to the September Stock Dividend, in a private transaction with gross proceeds to the Company from the sale equaling $2,591,102 (the “May Private Placement”). All of the shares sold in the May

This price equals .25 cents share. At the current price of $1.64, that would be almost an 85% discount to the current market price. Warp did the same thing in September when they raised additional funds again at .25.

On or about September 13, 2002, the Company closed an offering of 3,600,000 shares of its common stock, after giving effect to the September Stock Dividend, in a private transaction with gross proceeds to the Company from the sale equaling $900,000.

Stocklemon believes that this raise might more accurately reflect the true value of the company and the size of the discount to market should serve as a sign to all potential investors.

Conclusion

Warp Technology missed its window of opportunity to go public three years ago when the market was ripe for these technology plays. Even though there technology might be promising, Stocklmeon believes that they are a day late and a dollar short. They do not have a customer base that supports their market cap neither do they have the finished product or the financial resources to compete in this difficult tech environment.