Member Info for NorthernExplorer

Do you think some of the sellers today were put off by the 12.11% annual running costs shown in the document. LOL

http://home.bt.com/lifestyle/money/investing-pensions/if-market-traders-could-pick-just-one-stock-11364221408131

Mengha i'm not new to the board as you say, posted Oct when I bought some but sold soon after, I will buy back as a recovery play if it goes under 1p

Mengha ...that's just copied from share prophets..it explains to people who don't understand the Convertible Unsecured loan situation...its like many have already have quoted the start of the death spiral...I looked at this quite a while back and asked about DA...I held back from investing as it did seem obvious they were ramping it up o high heaven and more recently the lack of funding...in laymans terms it really doesn't look good. But I might gamble if it reaches a penny

Could well be worth a gamble at around 1p or less...basically like roulette 50/50 chance of surviving and winning

First, the business can put out a positive announcement that increases share volumes significantly and helps boost the share price. If the share price goes above Friday�s closing bid of 2.75p on Monday and Tuesday, then the funder would convert on Wednesday. The issue here is that Al Sisto shot his bolt a bit by putting out the portfolio update on Thursday but am sure he will be working away over the weekend desperately trying to come up with something. The other two blockers are more technical. Normally at some point, the amount of authorised share issuance capacity comes into play and it isn�t allowed to issue any more shares. However, the Board here managed to get authorisation at the last AGM for a small-looking additional �50,000 of nominal share capital to be issued. However, as Tern has a tiny nominal price of 0.02p, this actually amounts to 250 million shares. There is a learning point here for shareholders to take a closer look at the share capital amount in that authorisation resolution to understand what it means in terms of number of shares. This links to the second point as often the death spiral causes the share price to drop below the� nominal price of the shares meaning that no more shares can be issued., Again, that it not an issue here�..for now! Accordingly, if there is no further news in the short-term, there is a theoretical argument that the share price could spiral its way downwards to allow the funder to cash in about 230 million shares which is around the 0.2p level!

One needs to look at how the spiral plays out though to really understand the evil at play. The closing bid on Thursday was 3.75p, so the funder can now sell 14.7 million shares (up from 11 million) in this first tranche. Then it sells a couple more million say on Friday which has dropped the closing bid to 2.75p. This now means that it can sell 20 million shares in this first phase. With the volumes normally traded at Tern, if this pattern continued, the funder would never catch up with itself, each day it tries to sell more than the previous day but if the share price keeps dropping, mathematically, it then has more remaining to sell than it did the previous day! By way of example, if the bid dropped to 1p next week (not totally inconceivable at this rate), the funder can convert into 55 million shares, and it�s going to struggle to get those away any time soon. This can all be done in conjunction with a friendly broker that allows it to trade at T-20 so there is no rush to covert to complete the trades. One can now see why the funder was less worried about the 10% discount as it would have been well aware of the effect of its selling. This supercharged spiral can only be stopped by three things.

Looks like it could be the end or maybe a gamble if it gets to around a penny...share prophets have probably it bang on...this is the article Tern�s deal was announced on Thursday morning and the share price, having closed at 5.125p on Wednesday, closed yesterday at 2.875p, a drop of 43% in two days; but it could get a lot worse yet. The issue with this particular funding arrangement is the size of the amount lent relative to the size of the company and, connected with that, the volume that needs to be traded by this unnamed death spiral funder, in relation to the normal volume traded at Tern. When the deal was announced and the funder lent �550,000 (less unknown expenses of course), its aim would have been to get this money back as quickly as possible by selling shares in advance of a conversion. At a closing bid on Wednesday of 5p, that means that it would have at least 11 million shares to sell, so it would have started making inroads immediately. In fact, from looking at the volumes, it could even have started on Wednesday. Unfortunately, if one looks at the normal volumes here, there are many days when the volume at Tern is less than a million shares traded, both buys and sells, and then along comes along L1 / Belastock / whoever and starts selling a million or more each day. This will have only one effect on the share price. I understand that a more sensible funder would look to trade about 15% of normal traded volumes to keep the effect on the share price to a minimum. Here, it is trying to trade amounts in excess of average daily volumes. It is crazy.

He still has about 13% of the company

Was that not Harwood selling 1.5m ?

Seems like good news another carrier

Been watching this a while and have a small holding that I bought recently. I had noticed that you questioned the 2 sales. I’ve a few holdings in smaller companies and often notice when there are large trades especially delayed ones they are often shown twice on here. As far as the sale price I’ve also experienced sales in small illiquid companies that if you try and do a large sale you will normally be quoted a lot less that what they have as the bid. And while I’m on the subject. Lse figures are miles out. When you look at the total buy and sells they are often out by well over 50%. The news out regarding training has to be a boost for us.

Interesting

Just looked over on the advfn bb everybody seems to think the projected figures are flying pigs and they are desperate to push....DA.....Not sure which way to look...lol

Anybody got any good info and news to check out. Everything appreciated

I've looked into and also agree the future does look promising. The diminishing returns that the brokers quote are as you explained .... the testing period. In fact I believe it looks very promising and will probably be investing next week. Thank you

Just browsing these shares and have looked at this one...it seems that its price is over 4 times what the value of its holdings are....whats the thing Ive missed....why is it trading at such a high price ? thanks for any response

Just to clarify trout...like it said at the start of my statement it was a broker report from October....Just put that there to show the relevance of the B shares....I've been looking at this share with its nice looking discount to NAV...but noticed from brokers and other chat boards there is a lot of negativity regarding DA and its diminishing revenues...still looks like it could be a decent buy...though maybe not as good as first glance...

Brokers report In October, at the time of Tern�s additional investment, the Enterprise Value of Device Authority was calculated at �18.4m. Tern has 60.7% of the A ordinary shares, and 50.6% of the A preference shares. There are also B shares (which it does not own) that are entitled to 25% of the Company on a sale, so knocking 25% off for the B shares, we can perhaps estimate a revaluation to around �7-�8m. vs an in-cost of �4.3m. (worth perhaps a couple of pence on the NAV).

Still very good value....but you have to knock off around 25% of our value of DA because of the B shares that we do not hold....and entitle B share holders to 25% of the sale of the company