VALENCE TECHNOLOGY (VLNC) Message Board

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Technology Stocks : VALENCE TECHNOLOGY (VLNC)

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To: Bruce A. Thompson who wrote (6415)	12/29/1998 10:06:00 PM
From: Bruce A. Thompson	of 27311

What's a Million Dollars Between Friends? by: bathompson (47/M/Greenville, NC) 446 of 455 Floorless Convertible Preferred Stock: A stock issued in security for a loan to a large investor. It carries an interest rate at or above the market payable usually quarterly and in shares of common stock. It is convertible into shares of common stock. While it is unconverted, it is not equity so the stock is not diluted. Since the conversion is figured in dollars but payable in common shares, it is to the advantage of the convertible holder that the share price be as low as possible when converted. This maximizes the return in shares of the company............. Two weeks later aboard The Bahama Mama....... "The stock price is getting up there" says Death Spiral. "I think it is time to short some more". "I'll just use the Preferreds as secutity" Picking up the satelite phone, Spiral calls his broker and shorts another $6 million worth of Miracles. The upward momentum stops and moves to the negative zone. At the same time Corporate Wenie has been busy........ Miracles Inc., today announced the IPO of 6 million new shares of common stock. With the announcement miracles also announced that all of the insiders have filed form 4's notices of intention to sell all shares held by them in the open market. Stock Defective announces that thier research reveals that the insiders intend to short the 2/3 of their holdings that are restricted and can't be sold. "DON'T WORRY, EVERYBODY DOES IT" Shouts Hypester on the message boards. Retreating from the pressure of all the insider selling, the stock price begins falling. It is now @ 90% of it's all time high. "Short another $6 million" Death Spiral tells his Broker.......

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