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**********INVESTORS SPOTLIGHT********** from STOCKFIRST http://www.stockfirst.com _____________________________________ CYBER DIGITAL, Inc. (OTCBB:CYBD) o A $250 Billion International Target Market The tremendous growth of the Internet has revolutionized the communications industry. Today, the Internet connects millions of people around the world who are able to share information instantly without geographic boundaries. The Internet is bound only by the voice network upon which it resides; without this network in place users cannot take advantage of powerful Internet applications. In developed countries, such as the United States, the requisite voice network is already in place, hence the number of Internet users is growing at unprecedented rates. In developing countries such as Nigeria, China, India and Brazil, there is little or no basic voice network, leaving many of these nations struggling to take part in the Internet revolution. The demand for Internet applications, such as distance learning, municipal virtual private networks and medical/emergency communications systems have induced developing countries to aggressively invest in communications infrastructure. These countries must first build a basic voice network, the platform of the Internet, before they can become part of this information revolution. The total incremental information infrastructure spending is projected to reach $1.5 trillion over the next ten years, according to Pyramid Research. The following table shows projected five-year information infrastructure spending for selected countries: Projected Information Infrastructure Investment by 2005 Country Number Lines Built Cumulative Investment (000's) US $millions China 91,042 172,077 India 41,387 44,266 Brazil 15,881 34,099 Nigeria 5,000 7,000 Source: Pyramid Research o A $32 Billion Domestic Market According to International Data Corp. (IDC) the worldwide Internet firewall market will grow to $11 billion by 2004. IDC also projects that the investment in the US market for network service provision by digital broadband means will grow to $32 billion by 2003. What is fueling these explosive growth estimates? The answer is simple - the vast expansion of electronic commerce (e-commerce); both business-to-business commerce, and business-to-consumer commerce. We are all familiar with the household names in e-commerce like Dell Computer and Amazon.com. These businesses are large enough and sophisticated enough to handle networking and e-commerce technology largely on their own. But what about small to medium size businesses? What about branch offices of larger organizations? How will they survive and compete in the e-commerce marketplace? Much of the forecasted growth in firewall and digital broadband markets will come from the tens of thousands of small to medium-size enterprises that have historically lacked the human resources to address e-commerce on their own and the financial resources to acquire expensive technological solutions. These businesses will require vendor-partners who can help them with affordable, simple "do-it-yourself" Internet solutions. One company, which stands out as a potential leader in voice and Internet switching industry with the vision and strategy to leverage this tremendous telecommunications growth opportunity is NY-based, Cyber Digital (OTCBB: CYBD). Cyber Digital is a well-established telecommunications company with: * Agreements to market promote and sell its products throughout Nigeria; * a veteran management team; * a firm grasp of the issues and opportunities of the telecommunications market; * a successful, synergistic alliance with telecommunications giant AT&T; * and a suite of affordable products and services to complement its other strengths. Priced at only $1.13 per share as of the market close on May 25, 2001 Cyber Digital, Inc. is unquestionably undervalued and worth a closer look. o A Brief History of Cyber Digital Since its inception in 1983, Cyber Digital, Inc. has designed and manufactured high-quality software controlled distributed digital voice switching infrastructure systems for public telephone network operators worldwide, especially for developing countries. Cyber Digital is also a leading software developer and manufacturer of an array of high performance Internet systems such as routers, gateways, firewalls and servers for the creation of digital broadband and virtual private network ("VPN") services by Internet service providers (ISP). The Company's voice and Internet systems incorporate digital wireless transmission, which enable developing countries to easily and rapidly deploy telecommunications services to under-served consumers within months rather than years. Such long years are typical of competitor's monolithic voice-only centralized switches, which require underground cabling infrastructure. The Company believes that it is one of a very few, if not the only, company in the world with proprietary technology of distributed digital switching, ideally suited for the developing countries. In early 1999, the Company made the strategic decision to expand and leverage its many years of telecommunications experience by entering the broadband Internet products market. Recognizing the enormous need and opportunity to provide a comprehensive suite of e-business products to small and medium size businesses, Cyber Digital has developed a full set of Internet Protocol (IP) security, access and storage products, in conjunction with its strategic partner, AT&T. o Recent Developments --Expects to earn $0.52 per share for FYE 2002 In April 2001, Cyber Digital announced that it expects to earn $0.52 per share for FYE 2002 from projected revenues of $26 million generated from the Nigerian market. Due to the Company's early mover advantage position in the Nigerian market, it anticipates profitability in each of the last three quarters of FYE 2002. In addition, the Company expects to realize revenues from the digital wireless telephone network projects in five Nigerian states in the aggregate sum of $35 million, which have not been incorporated in these projections. "We feel that our Company's stock is highly under-valued and does not reflect the true value of its technology and growth potential. Once the Company has the resources, it may buy-back its shares in the open market from time to time," said J.C. Chatpar, Chairman of Cyber Digital, Inc. --Received approval of its proposals to build digital wireless telephone networks in five states of Nigeria. In April 2001, Cyber Digital announced that it has received approval of its proposals to build digital wireless telephone networks in five states of Nigeria for an aggregate sum of $35 million. "Cyber Digital's wireless CDCO exchange was approved based on its ability to rapidly deliver telephone service at affordable network cost requiring no stranded capital," said His Royal Highness Austin Ezenwa, Chairman of Sydney Telecommunications. "Each of the five states has appropriated capital for the implementation of Cyber Digital's wireless telephone network." "In addition to existing contracts, this accomplishment signifies our long-term viability by capturing a significant share of this market in early stages," said J.C. Chatpar, Chairman of Cyber Digital, Inc. "We expect to engineer, furnish and install these systems within the next twelve months." --Enters the $5 Billion Internet Firewall Appliance Market In January 2001, Cyber Digital announced that the Company is entering the $5 Billion Internet firewall appliance market, with the introduction of its Cyber Firewall (CFW) Series firewall appliances. Cyber Digital Offers Simple Do-It-Yourself Installation Software on Its Standalone IPSec Firewall Appliance For B2B e-Commerce Secure Access and Virtual Private Network Applications. IPSec is an industry-wide standard for assuring the privacy, integrity and authenticity of information crossing public IP networks. Cyber Digital's CFW series firewalls offer simple do-it-yourself installation software for even the most complex IPSec-based security application. CFW - IPSec provides a cost-effective way of creating an enterprise-wide virtual private network (VPN) by enabling secure use of the Internet. CFW - IPSec, based on Cyber Digital's proprietary technology, is a standalone firewall appliance and is totally independent of the customer's computing operating system platform. It does not need to be integrated into customer's environment by specialists, often a costly proposition. Non-technical customers can easily install the CFW firewall appliance. In addition, CFW series firewalls are fully interoperable with Cisco Systems, Check Point Software Technologies, and Nortel Networks firewalls. Cyber Digital's CFW appliance type security offerings will facilitate the secure access and implementation of VPNs for B2B e-commerce companies. "Our unique CFW series firewall appliance will be marketed through major strategic partners or distributors on a worldwide basis. The simplicity of implementing CFW in any network will cause a profound impact on the firewall market. As an Internet firewall appliance, it offers cost savings in excess of 50% over competitors' offerings," said J.C. Chatpar, Chairman of Cyber Digital, Inc. According to International Data Corporation (IDC), the worldwide Internet firewall market increased 32%, from $3.0 billion to $3.98 billion during 1998 to 1999. Similar growth is projected for the period 2000 to 2001, leading to a worldwide market of $5 billion. --Expands into the PABX market with CSX to government institutions. In January 2001, Cyber Digital jointly announced with Sidney Telecommunications (Nigeria) Ltd. their expansion into the PABX market. "Demand for Cyber Digital's CSX PABX, by government institutions, is overwhelming due to rapid growth of the capital city of Abuja," said His Royal Highness Austin Ezenwa, Chairman of Sydney Telecommunications. "On behalf of Cyber Digital, Sydney Tel is expecting to receive a blanket order for 10,000 CSX PABX lines from one of the government institutions for a number of its offices. Sydney Tel is confident that Cyber Digital's CSX PABX will become a standard office telephone system among many government institutions as it offers modern communications features." "We are pleased with Sydney Tel's efforts in expanding the market for our CSX PABX product line," said J.C. Chatpar, Chairman of Cyber Digital, Inc. "The initial order for 10,000 CSX lines reflects approximately $4 million in revenues." Pursuant to the terms of the order, payment terms are: 50% cash in advance, with the order, and 50% by irrevocable letter of credit upon shipment. --Enters the Nigerian Telecommunications Market In November 2000, Cyber Digital, Inc. signed an agreement with Sidney Telecommunications (Nigeria) Ltd., a private company, to market, promote and sell Cyber Distributed Digital Central Office Exchanges (CDCO), Cyber Tandem Switch Exchanges (CTSX) and Cyber Switch PABX (CSX) throughout Nigeria. Under the terms of the agreement, Sydney Telecommunications will also market Cyber Digital's Exchanges to the Nigerian Telecommunications Ltd., (NITEL), the sole, government owned provider of public switched telephone network services in Nigeria. In order to enter the untapped Nigerian telecommunications market, Cyber Digital, Inc. has already registered Cyber Digital (Nigeria) Ltd., as its subsidiary and established its offices in the capital city of Abuja. "With about 400,000 lines in operation, for a country with a population of 120 million people, the current telephone density is one of the lowest in the world," said His Royal Highness Austin Ezenwa, chairman of Sydney Telecommunications. "NITEL's goal to increase telephone density through deployment of two million lines by year 2003 can only be achieved by Cyber Digital's unique technology that renders rapid deployment coupled with affordability. Cyber Digital will carve out a significant share of the Nigerian telecommunications market as its digital switches are ideally suited for developing countries." "Demand for our CDCO and CTSX exchanges will increase as NITEL places great effort in building its telecommunications infrastructure," said J.C. Chatpar, chairman of Cyber Digital, Inc. "We believe Cyber Digital will be an important participant in the rapidly expanding Nigerian telecommunications marketplace." With the assistance of Sidney Telecommunications, Cyber Digital has bid on a public tender issued by NITEL for the supply and installation of 10,000 digital lines in the capital city of Abuja. Pursuant to the bid requirements, manufacturers of digital exchanges were exclusively permitted to make an offer to NITEL. All such tenders were publicly opened and results were announced at the corporate headquarters of NITEL. Offers varied from low end of $26 million from Cyber Digital to high end of $65 million from Siemens. Bids from Cyber Digital, Alcatel, Ericsson and Siemens were the only bids technically qualified. While the other three bidders were major European manufacturers, Cyber Digital was the only American manufacturer to qualify. Payment terms are 15% cash advance upon contract award and 85% by irrevocable letter of credit upon shipment of digital exchanges. Supply and installation of digital exchanges are expected to be completed within nine months. --Made a strategic shift to enter the fast growing, lucrative high-speed Internet access market. During FYE 2000, the Company made a strategic shift to enter the fast growing, lucrative high-speed Internet access market. The Company rapidly developed its Cyber Business Internet Gateway ("CBIG") and Cyber Internet Access Network ("CIAN") switch. The Company forged an alliance with AT&T Corporation to become a provider of high-speed Internet access and to create Virtual Private Networks ("VPN") for businesses using Internet Protocol (IP) "broadband" technology. At the heart of Cyber Digital's unique set of product offerings is its unique distributive voice and broadband solutions, which offer many advantages over the traditional voice and broadband approaches. -Cyber Digital's Unique Distributive Voice Solution- Current Telephone Network: Building telecommunications infrastructure using traditional monolithic centralized switching systems from multinational suppliers poses tremendous financial constraints and deployment time limitations because of outside plant underground cabling. Cyber Digital Wireless Network: The modularity derived from the nodal structure of the CDCO provides an economical digital switching exchange from as low as a few hundred lines to over a million lines capacity. In addition, it offers fully integrated local, tandem, toll and transit exchange capabilities. The CDCO has interfaces for digital microwave systems, digital copper wire systems, digital radio relay systems, digital wireless systems, fiber optic systems and satellite systems. The costs associated with this approach is dramatically less than the installation cost associated with laying fiber or copper on the network side (material costs, right-of-way issues, and regulatory obstacles). -Cyber Digital's Unique Distributive Broadband Solution- In the traditional broadband solution offered by most digital broadband Internet Services Providers today, office buildings are "daisy-chained" together with fiber or T1 wiring. This results in "several hops to the POP." This traditional solution has three inherent disadvantages: 1) a point of failure at each building in the chain; 2) security vulnerability at each building in the chain; and 3) decreased network performance. With Cyber Digital's innovative Distributive Broadband solution, there is no daisy-chain. Each office building is connected directly by fiber or T1 lines to the AT&T POP, i.e. there's only "one hop to the POP." In bringing the Internet closer to the user, the Cyber Digital solution offers enhanced performance, enhanced security, and eliminates the disadvantage of multiple points of failure. o The Experienced Senior Management Team Unlike many New Economy Internet sector companies, the well-seasoned, six member, senior management team at CyberDigital, led by founder Jawahar C. Chatpar, collectively represents over 125 years of business experience. This experienced management team provides a strong foundation for Cyber Digital to build upon as it implements its visionary strategy: Jawahar C. Chatpar is a founder of the Company and has served as Chairman of the Board, Chief Executive Officer and President since March 1991, as Chairman of the Board, Chief Executive Officer and Secretary from November 1986 until March 1991, and as President and Chief Executive Officer from inception until November 1986. Mr. Chatpar has also served as a Director since inception. Mr. Chatpar founded the Company in 1983 as a successor to a Canadian corporation of the same name, which he founded in 1982. From 1980 to 1982, Mr. Chatpar was employed by Bayly Engineering Limited, a manufacturer of digital telecommunication systems and a member of A.E.G. Telefunken Group, as a General Manager of Digital Transmission and Fiber Optics Engineering (research and development). From 1974 to 1980, Mr. Chatpar served in various engineering, general management and marketing positions with Northern Telecom. He holds an B.Tech (honors) degree in Electrical Engineering from the Indian Institute of Technology, Bombay, India and an M.S. degree in Electrical Engineering from the University of Waterloo, Canada. Larry S. Shluger has been Vice President of Operations of the Company from August 1996 and Secretary since March 2000. From 1991 to 1996, Mr. Shluger was Director of Purchasing and Operations at Cashtek Corporation, a company which designs, develops and manufactures computerized gaming systems. From 1975 to 1991, he was Director of Purchasing and Operations at Kenilworth Systems Corporation until its acquisition by Cashtek Corporation. Prior to 1975 he was employed in various management positions at Ecologic Instruments Corporation, a company which designs, develops and manufactures test equipment for the environment and pollution control fields, and Dynamic Instruments Corporation, a manufacturer of battery chargers. Dale A. Johnson has been Controller of the Company from March 1998, and Treasurer since March 2000. She joined the Company on March 1995 as an Accountant. From 1984 to 1994, she worked as Accountant for various CPA firms. She holds a B.B.A. degree in Accounting from Dowling College, NY. Sandeep Belani joined the company in July 2000 as Assistant Vice President of Finance. He had previously worked at the Company during the summer of 1999. Since May 2000, he holds a B.S. degree in Finance and Entrepreneurship in Emerging Enterprises from Syracuse University. Donald H. Lang joined the Company in September 1997 as Director of Engineering. From 1994 to 1997, he was employed by American Institute of Physics as Programmer/Analyst. From 1982 to 1993, he was employed by Harris Corporation, a defense contractor, as a staff engineer. He holds a B.S. degree in Electrical Engineering from Fairleigh Dickinson University and an M.S. degree in Computer Engineering from Rutgers University. Ronald Siegal has been Director of Technical Support and Customer Care since August 1996. He joined the Company in 1990 as Contract Sales Manager for Digital Voice Switches selling to the U.S. government. From 1988 to 1990, he served as Sales Manager for Computerland. From 1981 to 1988, he was employed as President of Meridian Communications. From 1968 to 1981, he held various sales and engineering positions with Executone Corporation. He holds a B.A. degree from Hofstra University. o Business &Financial Outlook During the past two fiscal years, the Company was primarily engaged in accelerated research and development activities towards the creation of CBIG, CIAN, CFW, CNAME and CWEB digital broadband systems and incurred losses of approximately $2.0 and $1.1 million for FYE 2000 and 2001 respectively. The Company anticipates to begin execution of NITEL's $26 million contract to supply digital voice switches within the next few months contemporaneous with the issuance of 15% cash in advance ($3.9 million) and an irrevocable confirmed letter of credit for 85% ($22.1 million) of the full contact amount. The Company will generate net revenue of $21 million after deducting for local custom duties and services provided by other vendors. The Company expects EBITDA of $10.5 million from this project in FYE 2002. Since, the Company has $14 million loss carryforward, the effective income tax rate for FYE 2002 is expected to be 0% instead of 39%. Year Ending March 31 2001E 2002E Net Sales ($000) $38 $26,000 Net Income (Loss) ($000) (1,117) 10,500 EPS ($) (0.06) 0.52 Avg. Shares Outstanding (000) 20,162 20,162 The Company has no long-term debt Moreover, Cyber Digital's forecasts portend a market capitalization of approximately $608 million by the end of fiscal year 2003. Assuming a projected 20.5 million shares outstanding at that time, that would suggest a stock price in the range of $29.00-30.00 per share. This is a challenging time in the high-tech sector, but the New Economy is here to stay. Predicting the winners and losers in the New Economy is difficult, but the winners will undoubtedly require the right vision, the right investments, the right products, and the right timing. We believe that Cyber Digital has articulated a strong vision, made astute investments, and entered the e-business marketplace with a strong suite of products at a perfect time. The initial results of Cyber Digital's efforts show excellent potential. We encourage you to take a close look at this promising company? o For More Information on Cyber Digital For more information on Cyber Digital, write cybd@cyberdigitalinc.com. We encourage you to visit their web site, http://www.cyberdigitalinc.com. o News Releases (all times are US Eastern) Tuesday, May 29, 2001 Cyber Digital, Inc. Signs an Agreement with Omomia Associates of Nigeria - PR Newswire - 9:20 am Wednesday, May 23, 2001 Nigerian Communications Commission Assigns Ten-Year Telecommunications License to Cyber Digital, Inc. - Business Wire - 9:11 am Cyber Digital, Inc. Receives Ten-Year Telecommunications License From Nigerian Communications Commission - PR Newswire - 7:40 am Monday, May 14, 2001 Cyber Digital, Inc. Details $26 Million NITEL Contract - Internet Wire - 7:15 am Monday, Apr 30, 2001 Cyber Digital, Inc. Projects Earnings of $0.52 Per Share for FYE 2002 - Business Wire - 10:04 am Cyber Digital, Inc. Expects to Report Earnings of $0.52 per Share for FYE 2002 - PR Newswire - 9:12 am Monday, Apr 23, 2001 Cyber Digital, Inc.'s $35 Million Proposal to Build Digital Wireless Telephone Networks Receives Approval - Business Wire - 10:11 am Cyber Digital, Inc. Receives Approval of $35 Million Proposal to Build Digital Wireless Telephone Networks - PR Newswire - 9:04 am Wednesday, Feb 14, 2001 CYBER DIGITAL INC - Quarterly Report (SEC form 10QSB) - EDGAR Online - 3:30 pm ------------------------------------------------------------------- IMPORTANT DISCLAIMER STOCKFIRST is an independent electronic publication providing information on selected public companies. Any company profiled by STOCKFIRST pays cash or stock consideration for the electronic dissemination of the company's information for a specified time period and/or our comments about the company and/or our development of the company's website. 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