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Technology Stocks : VALENCE TECHNOLOGY (VLNC)
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To: FMK who wrote (5921)12/12/1998 2:39:00 PM
From: MHS  Read Replies (2) of 27311
 
Fred,

What do you think of the following (off the Yahoo Board which is generally a waste of time), any accuracy?

mhs
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FMK's Share Projections are Too Low
by: nowaynohow 7684 of 7684
Yes, he did go up from 25 million to 30 million. Hard to keep it at 25 million when they are currently almost to 26 million.

The recent filings related to the financing (1st tranch only) show a minimum of an additional 3.6 million shares being issued. That takes us to 29 million.

The recent filing regarding the employee stock option plan adds another 3 million shares. That takes us to 32 million.
So, you can start with a minimum of 32 million shares.

But don't stop there. Remember the company currently has a working capital deficit of around $6 million, and will need more funds just to continue operations in 1999. On January 7,management will be asking shareholders to issue an unlimited amount of new shares related to the CC financing.

Even if everything goes right and they start commercial production some time in 1999, they will need more funds for working capital. They will also need more funds to buy all of the additional lines that are inherent in FMK's projections.

The wild card is the floorless conversion and the potential unlimited dilution it could create. Bottom line is I would guess by this time next year there could easily be 40 million shares outstanding, and possibly (under a death spiral situation) many more.
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