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

To: Zeev Hed who wrote (9207)	3/13/1999 11:11:00 AM
From: Rich Wolf	Read Replies (3) \| Respond to of 27311

Has Castle Creek really sold short? I think not. Here's why: The S-3A document from February 1999 lists CC as a "beneficial owner" of 1,375,919 shares of common (from conversion of the Series A preferred stock at the fixed price). This document is the filing for the additional 1,702,583 shares of common, combining the conversion of the Series B preferred at the assumed fixed price, plus "warrants to purchase up to 895,522 shares of (our) common stock at a price of $6.78 per share" (extracted from the SEC filing). At the time of the filing, the stock had not yet been issued, and CC was still beneficial owner of only 1,375,919 shares. Now here's the important part: If CC were to allow any of their converted or unconverted shares to be sold, sold short, or pledged to another party as collateral, to then be sold short, then CC would be considered a "selling shareholder" by the terms of this document, and the number of shares beneficially owned would be decreased thereby. (See the quote below extracted from the S-3A.) Since the number of shares beneficially owned as of Feb. 10, 1999 has NOT been measurably reduced (if at all) from the amount initially converted from the Series A, then the conclusion is that those shares have NOT been sold short BY ANYONE. As of Feb. 1999, there are currently 1,253,813 shares short. But judging from the wording in this filing, they aren't the shares from the preferred stock sold to Castle Creek. Whoever has sold short WILL still need to cover on the open market. ------------------------------------------------------ Extracted from the S-3A: "From time to time, CC Investments and Gemini Capital may transfer, pledge, donate or assign shares of Valence common stock to lenders or others, and each of such persons will be deemed to be a "selling stockholder" for purposes of the prospectus. The number of the selling stockholders' shares beneficially owned by a selling stockholder who transfers, pledges, donates or assigns shares of our common stock will decrease as and when they take such actions." ------------------------------------------------------------------ I would further point out that the "warrants to purchase up to 895,522 shares of (our) common stock at a price of $6.78 per share" would provide Valence with OVER $6M ADDITIONAL CAPITAL. There are also 175,000 warrants held by Gemini Capital, and the $7.5 loan available from Carl Berg, with its associated warrants. That is why I do NOT view March 31 as a 'drop dead' date for needing cash flow from POs.

To: Zeev Hed who wrote (9207)	3/13/1999 1:24:00 PM
From: Tickertype	Read Replies (3) \| Respond to of 27311

Zeev, I noticed your comment re Wexler's posts ......"I do not think that Bill is claiming the company is fraudulent, he refers to the constant stream of "inside tips" from a number of posters"......... Here's one of his exact statements as of yesterday: "VLNC is a full-fledged fraud and will eventually trade below 1 a share." Sure looks to me like he's saying the company, not the posters, is a fraud. His comment that ...."so many executives have fled the company"... also very clearly demonstrates his poor grasp of the facts. For his edification the previous CEO didn't "flee", he was ousted, and the others were mostly ousted by the present CEO - they also didn't "flee". I would think the fact that many of them have added to their stock holdings after leaving the company would tell Wexler something about their views of the company, but I guess when you're a short you can't be bothered with the facts. So far, Wexler has really been preaching to the choir here, as most of the folks on this thread are way ahead of him. But it does provide food for debate while we wait, poor as his arguments may be. - T -