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Strategies & Market Trends : Three Amigos Stock Thread -- Ignore unavailable to you. Want to Upgrade?

To: Sal D who wrote (12192)	1/1/1999 8:17:00 PM
From: Sergio H	Read Replies (1) \| Respond to of 29382

Joe, I see the stock going to 21, shortly after CAT completes the initial share purchase at 18. The stock wil probably remain in a trading range between 18 and 21, depending on market conditions, until CAT exercises the warrants. Looks like CAT is getting ASVI cheap, doesn't it? The agreeement is subject to shareholder's approval at the meeting scheduled for Jan. 28th. Reportedly, 25% of ASVI's shares are already pledged to accept the agreement. The warrant exercise period is 10 years long. ASVI's stock price will depend on the market's reaction and interpretation to the performance based adjustment portion of the warrant exercise price: < ASV has also agreed under the Purchase Agreement to issue the Warrant at the Closing. Upon issuance, the Warrant will entitle Caterpillar to purchase an additional 10,267,127 shares of Common Stock of ASV at a purchase price of $21.00 per share. The Warrant will be exercisable at any time from the date of the Closing until the tenth anniversary of the date of the Closing, except that the Warrant may expire with respect to a portion of the shares covered thereby in the event that ASV meets certain revenue levels as follows: 7 NUMBER OF SHARES AMOUNT OF REVENUES REMAINING SUBJECT TO THE WARRANT ------------------ -------------------------------- $100 million 8,727,058 $150 million 6,673,632 $200 million 4,106,851 $250 million Zero In the event that (i) ASV meets one of the revenue goals set forth above for any four consecutive fiscal quarters, (ii) ASV's gross profit derived from such revenues is at least 20%, and (iii) the market price of the Common Stock at such time is greater than $21.00 per share, then ASV will have the right to give an acceleration notice to Caterpillar and upon the expiration of 75 days following the giving of such notice, the number of shares subject to the Warrant will be reduced to a maximum of the number of shares set forth above corresponding to the revenue goal achieved (the "Warrant Expiration Clause"). Under the terms of the Warrant, ASV has the right to terminate the Warrant upon 60 days' prior written notice to Caterpillar in the event that ASV has terminated any of the Commercial Alliance Agreement, the Marketing Agreement or the Technology License Agreement as a result of a material breach by Caterpillar which is not remedied by Caterpillar, or ASV has terminated one or more of the Trademark and Trade Dress License Agreement, the Management Services Agreement, a Supply Agreement or the Joint Venture Agreement as a result of a material breach by Caterpillar which is not remedied by Caterpillar and ASV is materially unable to realize the benefits provided collectively by those agreements. See "The Commercial Alliance Agreement." The Warrant provides for proportionate adjustment to the number of shares subject to the Warrant and the Warrant exercise price in the event of stock splits and combinations, stock dividends and distributions, reclassification of stock, a reorganization of ASV, sales of shares below the Warrant's exercise price or a liquidation of ASV.>