VALENCE TECHNOLOGY (VLNC) Message Board

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Technology Stocks : VALENCE TECHNOLOGY (VLNC)

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To: John Curtis who wrote (4971)	11/13/1998 10:45:00 AM
From: Larry Brubaker	Read Replies (1) of 27311

John, a question to ponder is whether, our hedge fund friends, if they were so inclined to attempt to drive the stock price down, would wait until after 1/27 to do so. This is the first time I've seen this particular animal of financing. One in which the conversion is at a fixed rate under one set of circumstances, and a variable rate under another set of circumstances tied to milestones and dates. Obviously our friends at the hedge fund would incur less risk by waiting until 1/27 to decide. On the other hand, if they became pretty certain at some point prior to 1/27 they would see no contract by then... Particularly if they thought there would be more to gain by shorting sooner because of a higher stock price. A while ago, one poster compared VLNC to an option in that its stock might have a declining value as it gets closer to the expiration date (e.g. 1/27). I thought this was a pretty interesting comparison. So I guess all this is a long-winded way of saying I'm not sure you'll have until Feb. before you will see the effects of a variable rate conversion, should it come to that.

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