Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: I. N. Vester who wrote (3221)	6/30/1998 7:03:00 PM
From: I. N. Vester	Respond to of 27311

Mooter et. al.: Any educated guesses on dilution factor we might need to suffer to get financing? I would guess they will need at least $10-20M to keep the ramp up going, pay for equipment, materials & payroll until enough cash is flowing in to keep the Co. unmistakably afloat. Perhaps they can get buy with just $10M, but somehow i doubt that they would try to cut it too fine and then have to come back to the well later. Even $20M might be conservative. I would guess they borrow and issue prefered stock against the loan with the option to convert to common stock at around $5/share. The prefered stock will have priority in accessing any company assets in case of insolvency, but i don't think they would be forced to give away ownership for less than $5/share. If they have to issue another, say 4M shares, in return for $20M, I would agree that is something I can live with. Any financial types out there who can help us do a closer speculation on what to expect in this regard? I would really like to hope the necessary financing will be available without too much dilution, but I don't know for sure. Remember, they have been insisting that they could do it with NO dilution. I believe today is the first time they admitted there WILL be dilution in order to get financing. Again, until proven otherwise, I will worry that at least short term, even from current prices, the stock will take a hit if they require much dilutions to get more funds. Whatcha think?