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

To: kolo55 who wrote (7333)	1/22/1999 6:11:00 PM
From: Rich Wolf	Respond to of 27311

Paul, Interesting that you mention potential insider selling. I had just pulled up the trades for December, and saw that the ex-CFO Dave Archibald had exercised options on 3 days, and on 2 of those days he had sold the exact number he'd exercised (15,143 and 4,353). He has 71,436 common remaining from the option exercise on the third day, in addition to previous holdings. The sales were for the higher exercise prices (around $6 and at $8.88, respectively), and the third day's were priced at $3.19 to $5. He'd still have a nice profit if he found he needed to flip those as well, or his much earlier exercises in the $3.50 range. Just a parallel observation, not that he's the one. Rich

To: kolo55 who wrote (7333)	1/22/1999 6:32:00 PM
From: I. N. Vester	Respond to of 27311

I doubt that CC sold their position from the first tranche. I have not wanted to discuss this because of the endless obsession with the terms of conversion of the preferred. Zeev, Larry, et. al. had a huge axe to grind, and I don't really want to pour more gasoline on their fire. I don't think anybody can prove what CC did or did not do. They do not hold 5% of the stock so any sales would probably not have to be reported. Since they registered the shares already, I'm not sure if there would be any way to verify whether or not they had converted. Would any conversion itself require an additional filing with the SEC (they would never hit the 5% ownership threshold on the common)? But the number of outstanding series A preferred is reported. The proxy statement did give us a count of 7500 shares of prefered A, didn't it? This would prove that they still held all the preferred A shares. Since they dropped any variable conversion of those shares (their only motivation for doing so was to have vlnc pick up the option to go with them for the second tranche - they gained absolutely nothing else in exchange), they are 'stuck' with a fixed conversion. Larry will probably claim that they already sold all those shares short so they don't care. But in that case we need to see a net increase of 1.5M on the short interest to prove that they are currently delta neutral on their first $7.5M investment. Given that they still hold 1.5M shares long, that is strong confirmation of the simplest theory as to their outlook for the whole deal, namely that after much DD, they were in July and remained in December extremely constructive on the company and its chances of producing significant rewards for its shareholders. If that's what brought them into the deal, it's quite likely that they are holding for long term gains, rather than doing all the 20/20 hindsight trading Larry is so good at. I'm sure that all kinds of other theories can be concocted and there may not be any way of proving any of them wrong. Pls help me if I'm wrong about this, but I'm not sure if we can glean anything about CC's actions except for filings which might continue to show that the 7500 preferred A shares are still outstanding.