WHOA!!! I love it some solid questions.... Thank You...
1. Is it known what the arrangement was in acquiring the patents? Specifically, what did they pay and is there a royalty? How much is the royalty?
Answer: I have not been able to get this disclosed to me. They are very tight lipped on this but I have tried.
2. How many warrants are there? Your calculations of dilution didn't seem to include these... Could there be 10M? Is this a reason they are so depressed?
Answer: Well 117K x 50 warrants attached = 5,869,750 plus (2,595,000 Pledged) but I do not know if the bridge holders has received but I count them too. That makes a little over 8M so I rounded it off to 9M to be on the safe side.
3. Why did they do this reverse merger with Midland? Why not just start fresh? It seems strange...
Answer: anybody that knows the cost associated with an IPO knows a reverse merger is the way to go. Cost effective, MMs already in place, legal fees, IPO fees, Transfer agent fees, etc. etc. etc. Simply money. Plus the stock structure is already in place.
4. Gordon Stuntz had some interesting points. Of particular concern is the validity of the patents. Plenty of patents are granted that are later revoked in court. I am not sure we will know the answer to this unless they are successfully/unsuccessfully challenged in court.
Answer: well Gordon is the chemist for Exxon and Exxon will request the patents prior to testing the product. Since Exxon requested to test DF-144 and did not issue a dispute of the press release I guess or can safetly assume the patents must be valid. No one especially a major corporation is going to spend money on a product testing if they are concerned with the patent validity.
5. What sensitivity is there to ethanol prices? What if corn prices explode while oil stays low... Doesn't that make ethanol blends less attractive. (I kind of discount this because of environmental reasons but it came to mind, so I thought I'd ask)
Answer: Well I suppose it will cost an increase in the price. probably 100% sure it will but they will merely pass on the cost. Just like every other product than an act of God can affect. Heck gas & oil is notorious for massive ups and down. It will be handled the same way.
6. This sounds way to good to be true, so I guess that in itself is a big question, but I am an adult, so I guess I will form my own judgement here.
Answer: why do you think I flew out to Dallas and got the SGS test data and dug deep out there that this product actually existed. I asked the same question probably 14 different ways to get a conclusive answer. I went as far as I could go and they did not put on a dog and pony show either. They have what they state they have in my book. Now as sson as the industry convinces themselves then the exception to the rule will be upon us. Now I feel that when I first did the DD it was too good to be true since 115 is the highest octane level known. So I made the flight. And I am still here and still buying more on the dips.
Finally, the release of the 18th: I too would like to understand the rationale behind this.repricing the warrants may be to draw in more of them by encouraging conversion. To raise money? to reduce arbitrage? I don't know. I am still new at this game.
Answer: I feel it is something more than a good natured heart. They do not have the money to build the plants. Each plant construction cost is $6M so according to the warrant price with a 9M float they would only get 4.5M if every single warrant was exercised. There has got to be something else here.
Another thought. The preferred shares dividend. Does this not mean that shorting of P shares at the moment has become very dangerous. If a new preferred share 'P2' (1999 ones) is created anyone short will not be able to make good unless they get some. If I were shorting P shares I would be worried about a squeeze on the P2 shares or on P shares based on the fact they can trade separately and an imbalance could occur. But then you would expect the P share price to rise in the run up to tomorrow as shorts cover... (hasn't happened, I guess there isn't much P share short interest or we'll see
ANswer: I do not care if they are short or not myself. there is a max float of 117K out there if everyone ever issued had P to sell. Remember I do worse case because of another stock I thought we had it and BOOM 50M came into the float. So now I take the max ... I feel there is more than 36 people that have P also ...
Hope this helps but this is my synopsis and what is that worth. not much really.
GB
MIDL New Investor Information Post
Message 4608046
Redundant questions:
Coomon: for the price MIDL is trading at you get one security of ownweship Midland, Inc. '
Warrants: MIDLW ... They will be exerciseable after the 3 day settlement date and the TA has the resolution today. Ok you buy the warrant for the warrant price .. then you pay an additional .50 to exercise it ...
Example: warrants is .56 plus the .50 exercise = $1.06 AMSC
Perferred : MIDLP ... You buy the P for $26.50 you are buying 35 shares of common for an AMSC of $0.77 however you add in the dividend of 50% you will get a half a share of P which equates to 17.5 shares of common.
Example: 100 shares of P @ $26.50 = $2,650.00 = .50 AMSC
For a long term hold and capitalize on the stock to the max degree this is the buy. Of course it is a long term hold because the existing trading P is Oct 1, 1998 which will automatically convert in your account where the dividend will not but it will convert on Oct 1, 1999.
Dividends: The dividend will be pay to all shares held in an account regardless of when you bought at the close of Friday May 29, 1998. If you buy at 3:59 MIDLP Friday afternoon and it is confirmed by the broker you get the dividend.
DF-144: Is a real product and they have over 200 tests on it verifying the product and 3 major compnies have tested it before they came public. It has been produced, sold and even use in NASCAR.
Negotiations: They are in negotations with two major oil companies as per the news releases. |
