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

To: kolo55 who wrote (3512)	7/28/1998 9:32:00 PM
From: MGV	Respond to of 27311

"I estimated 10-20% dilution, and you estimated 35-100% dilution. I think you missed it on this one, Mark." I estimated 35% dilution and so far its not there but, if VLNC is unable to produce volume in October, it will need additional funds. In sum it remains to be seen whether this is just a palliative first round of financing or whether this is the last of the dilutive financing. No matter how you cut it, as far as it goes, its good news.

To: kolo55 who wrote (3512)	7/28/1998 9:56:00 PM
From: wm sharp	Read Replies (1) \| Respond to of 27311

Many thanks for your analysis, Paul. I agree, very favorable financing and, IMO, some strong indicators that all parties feel this is indeed the next battery generation. Best, Bill

To: kolo55 who wrote (3512)	7/28/1998 10:09:00 PM
From: Mark Johnson	Read Replies (1) \| Respond to of 27311

Paul, Visnic has nothing to offer this thread. He screamed fire a month ago intoning vlnc was going broke, greatly exaggerating 10-k disclaimers. The investors who hold long positions believed differently and should be rewarded in the long run. FMK's predications have proven correct. I bet his production projections will be on track as well. John Curtis should finally be satisfied with financing arrangements. Thank goodness we are over this minor bump and can move on. Lets not give Visnic any more attention, he doesn't deserve acknowledgement. Good Luck To All

To: kolo55 who wrote (3512)	7/29/1998 8:36:00 AM
From: John Curtis	Respond to of 27311

Paul: Not being a bean counter by trade I was rubbing me eye's last night when I did my layman's attempt. I couldn't believe it at the time, but you've just reinforced my rough approximation. Okay. I'm satisfied with the financing. Indeed, I'm about ready to do the "happy feet" dance over it, heh! If VLNC is truly on track then this is a win-win for everybody. I'm gonna go out on a limb and make a prediction at this point. Despite the warmth throughout the continental U.S. VLNC must have provided Castle CREEK(jeez, I said Castle Rock last night), et.al. with a considerable "warm & fuzzy." I say this particularly after looking over some of the other Castle Creek "endorsements." Those boy's & girl's clearly don't mess around and contribute casheesh for the fun of it. Now let me think.....what KIND of warm & fuzzy? Possibly a plant tour to see the line(s)? Gee, maybe even getting to touch the end product and see it in service? Perhaps even being let in on OEM developments? If you buy this then with things on track at VLNC I find it reasonable to assume we'll be hearing more out of VLNC sometime soon in that new area of interest, OEM developments! All imho, of course. Meanwhile, need I say I'm gonna be "glued" to my data devices come Market open. Let us see what the Street thinks, eh? John~

To: kolo55 who wrote (3512)	7/29/1998 10:56:00 AM
From: mooter775	Read Replies (1) \| Respond to of 27311

I was reviewing the calculations and am reasonably close to your calculations, Paul, except that I think at least the second $ 7.5 mm, and perhaps even the first $ 7.5 mm as well, (which is dependent on a milestone), would have its conversion price set after the milestone were met - press release reads "If the Company meets a certain milestone, the Series A convertible preferred stock will be convertible at a variable price after twelve months from issuance." This implies to me that if the company can meet this milestone (which is probably one or more contracts and possibly some minimum revenue generation)and trigger the second tranche, it is likely that the conversion price would be higher than the $ 6.00 you are using. My own guess is in the $ 10 - $ 12 range, which would imply a second trance dilution of roughly 600,000 - 750,000 rather than the 1,250,000 your calculations assume. Thus I get a likely overall dilution of 1,250,000 (maximum first tranche, perhaps as low as the 600 - 750 k for the second tranche), plus 675,000 (split the $ 10-$12 difference), plus the 444,000 for the warrants attachec to Carl Berg's note. Thus my dilution estimate is 2,369,000, around the 10% level. I had stated in the 10%-15% range earlier, and I think it reasonable that it will eventually end up around the 10% level. Now, this depends upon execution of the ability to produce, get an OEM contract, etc. or the naysayers will be right and the second tranche as well as any further financing would be at significantly lower levels. Also, a word about shorting against the price. There is some pretty stupid speculation about investors, even including Castle Creek Partners, would short common into their conversion price. Doubtful, in my opinion, since (1) the control of the timing of the milestone is not in their hands- it's in management's hands, and (2)VLNC already has access to what I believe are sufficient funds to complete their rampup, so shorting only makes sense if the short seller truly believes the company will fail to produce with the new funding - and that makes that short selling decision really indpendent of the financing.