I tried to call attention to Tenneco’s stock on November 27th 2009 when the new 12 million common stock public offering was completed.

At that time TEN close at or about $14.37  with me predicting it to reach $17.50 by December 11th.   It took a little bit longer than the two weeks I expected, but has continued to climb since that December 11, 2009 date.

There was some sell off toward the end of December, but today has come back strong, reaching a high of $19.57 (over a 10% gain in a day) before profit takeing  brought the price back down to close regular hours at $19.41 or a daily gain of 9.48%.

This would have accounted for a gain of at least $5.00 a share from my November 27th article, and I certainly hope some of you have taken advantage.

I am still holding Tenneco shares and plan to continue hold for the foreseeable future as I am expecting the American Automobile Sector to continue recovering which in turn will continue to fuel the recovery with Tenneco.

Tenneco took advantage to reach out to the foreign car manufacturers grabbing a greater market share of that sector, and with the American Automobile sector continuing to improve…..  I am expecting Tenneco to recover at least to the $25.00 to $30.00 range during the next year!  That will bring profits from today’s close of close to 30% and that is not bad in anyone’s book!

I am expecting Tenneco to begin setting a new trading cycle sometime in the near future giving many chances to increase your share count….  Just play it carefully as you don’t want to be totally of of the stock if any big news pushes the market.

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RVGD trading today went anyway other than what I expected. I wish I could say I understood what took place today, but I really don’t.

There was news released today by Revenge Designs Inc. announcing they had secured backing from Revolving Loan Fund Committee of Ohio.  This loan is to help Revenge Designs to establish the first Certified Installation aftermarket center to install the HP2g engine into existing vehicles.

Maybe many traders were simply expecting more dealing with financing, but that press release is very positive news.  It shows that there is enough belief (by the State of Ohio) in the HP2g engine that they are willing to advance money to help establish the installation center.

Maybe given Revenge’s past history it was that they announced a private placement loan investor was helping out  with funding for the completion of the Verde Supercar that is to be released at the January 11th through 24th 2010 North American International Auto Show in Detroit.

I don’t know, maybe it was more manipulation of the price per share of RVGD stock.  It seemed to trade rather funny.  For that matter it has traded kinda of funny for the last couple days.  Maybe today the press release turned out to be weaker than many expected and cause investors to pause and think a little harder before putting their money on the line.

I simply do not understand why RVGD trade the way it did today, but it traded down on what is a very forward step being press released.

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I own stock in Revenge Designs (RVGD)! All purchased by me on the open market. I am not being paid by the company or any third party for writing about this company.

New Home of RVGD's installation and training center?

Today, December 01, 2009, Revenge Designs released a press release announcing that their first HP2g Engine Installation and Training Center would be located at in Napoleon, Ohio.

The Revolving Loan Fund Committee of Ohio has granted a $300,000 loan, through the Ohio Department of Development,  to Revenge Designs  to secure an established building, leased in Napoleon, Ohio, for the purpose of Management, Marketing and the establishment of the first Revenge Certified Installation and training center.

Aerial view of the old Wal-Mart building in Napoleon, Ohio.

I personally believe the building which Revenge has secured to be an abandoned Wal-Mart building located at  1851 Oakwood Avenue Napoleon, Ohio.

Revenge Designs also announced it had also secured a private placement loan investor in Ohio; this assists Revenge in the completion of our Verde Supercar to be released at the January 11th through 24th 2010 North American International Auto Show followed by the Chicago International Auto Show February 2010.

Revenge Designs also confirmed that estimated time to  true production of the Revenge Verde Supercar to be the 3 Quarter of 2010.  The Verde will be built using a previous production Supercar’s aluminum chassis platform, thus eliminating extensive testing and expenses relative to production.

Revenge also stated that the Revenge Verde will be produced using an existing assembly line previously developed, but did not confirm that would be with Saleen Special Vehicles; the company I wrote about in “Guessing Who is Revenge Designs Associated Team?”

Revenge claims to expect to be able to produce 750 Verde Supercars from the 3 quarter of 2010 until the end of the year. With the ability to ramp up production to 1,500 vehicles per year through 2001 and 2012.

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I own stock in Revenge Designs (RVGD)! All purchased by me on the open market. I am not being paid by the company or any third party for writing about this company.

The other day, I received a message from someone that I don’t always see eye to eye. The Jest of the message was that he was disappointed in the Revenge Designs (RVGD) Scam or the Real Thing? You Decide article. Saying I didn’t do justice in addressing the dilution, the actual end results of many the statements released in the 2008 PR’s, nor the lack of the promised Revenge website updates.

Well, I really want to have “Lady Justice” proud, I will attempt to tackle his objections. I am quite sure he will not agree with most of what I will write, but I will give my honest opinion.

Let’s start with covering the  “UGLY” dilution, how it happened and how it affected the price per share.

Source: In September 2007, Revenge Designs entered into a promissory note with Signature Leisure. Revenge Designs agreed to pay Signature Leisure $322,000, consisting of $300,000 in debts that Revenge Designs already owed to Signature Leisure, and about $22,000 in new loan proceeds.

Under the terms of the note, Revenge Designs’ indebtedness could be repaid either in cash or in shares of Revenge Designs’ common stock, at Signature Leisure’s option. Under the latter option, ” the debt will be converted to Borrower’s common stock at a 50% (fifty percent) discount from the opening bid price on the date Lender converts the debt to Borrowers common stock.”

Between November 2007 and February 2008, Signature Leisure accepted repayment in the form of discounted Revenge Designs stock. Signature Leisure submitted five conversion requests, which resulted in Revenge Designs’ issuance of about 195 million shares of its stock to Signature Leisure. Signature Leisure received more shares than it was entitled to under the stock conversion formula. Shortly after receiving the shares from Revenge Designs, Signature Leisure transferred the stock to other individuals and entities, who, on information and belief, promptly resold the stock into the public market.

From September 2007 through January 2008, Revenge Designs entered into 13 promissory notes with K&L. Under the terms of the notes, K&L International Enterprises, Inc. loaned Revenge Designs approximately $420,000. K&L also had the option of accepting repayment in cash or in Revenge Designs stock, calculated “at a 50% discount, based on the opening bid from September 14,2007 of$.005 (one halfofacent)” or similar formula

K&L opted to be repaid in discounted shares of Revenge Designs stock. From October 2007 through February 2008, K&L sent Revenge Designs seven conversion requests, resulting in Revenge Designs’ issuance ofabout 352 million shares of its stock to K&L.

From November 5,2007 to March 7, 2008, K&L resold nearly all the shares of Revenge Designs stock into the public market, yielding net profits of almost $1 million. K&L made nearly all of these sales within days or weeks ofreceiving the Revenge Designs stock.

Chart showing the initial loans and when converted

Now lets talk about the “Wrap-Around Agreements”.

As a general matter, these wrap-around agreements work as follows:
First, the transaction is predicated upon a debt the Issuer Company allegedly owes to one of its officers for more than one year, either for unpaid salary or a loan. The Issuer Company and its officer (or another affiliate) agrees to assign the debt to a Stock Distributor Defendant. The agreement modifies the purported original debt “to include a convertibility provision allowing [the Stock Distributor Defendant] to convert [the debt that the Issuer Company now owes to the Stock Distributor Defendant] into common voting stock” based upon a formula set forth in the agreement. Second, the Stock Distributor Defendant signs a promissory note agreeing “to purchase the debt due and owed” to the officer for an amount equal to, or for a percentage of, the debt, generally within a one-year period. Third, the Stock Distributor Defendant requests that the Issuer Company convert the debt into shares of an Issuer Company and the Issuer Company issues shares to the Stock Distributor Defendant, usually at a significant discount and without adherence to the convertibility formula. Fourth, before or after the request, the Stock Distributor Defendant pays cash to the Issuer Company or its officer. Fifth, in a matter of days or weeks after issuance, the Stock Distributor Defendant resells the stock into the public market, reaping enormous profits. Again my source is court case # 6:09-CV-1638-31KRS

In May and August 2008, Revenge Designs entered into two wrap-around agreements with K&L International Enterprises, Inc.

Under the agreements, Revenge Designs and its officer assigned to K&L $345,000 in alleged debts, representing loans supposedly made to Revenge Designs by its officer through another one of his companies. As consideration for the debt assignments, K&L signed promissory notes in which it agreed to pay Revenge Designs’ affiliate an amount equal to the alleged debts. Thereafter, K&L paid the affiliate $195,000, which the affiliate passed on to Revenge Designs.

The agreements contained convertibility provisions that allowed K&L to convert the debts into stock at a 33% discount relative to market price. Shortly after the agreements were signed, K&L made a series of conversion requests to Revenge Designs; Revenge Designs issued 965 million shares of its stock to K&L.

Within about six weeks after receiving the Revenge Designs stock, K&L sold the stock into the public market. These sales constituted more than 43% of the shares of Revenge Designs stock outstanding in the public market (not including shares previously acquired under the promissory notes).

K&L wrap-around conversions

I think you can see from the charts I annotated from where the real dilution came, and the affect it had on Revenge Designs stock price.

Now lets try to cover the “bad”.

On December 19, 2007 Revenge Designs Announces Negotiations for First Satellite Assembly Location. That Satellite assembly location never came to be. I would suggest (my thoughts only) that with the way gasoline prices affected the SUV market in 2008 in the U.S. that maybe there was not nearly the response for Honda Ridgelines in General nor the customizing of Ridgelines that Revenge Designs anticipated.

On December 27, 2007 announced in a Press Release that they had purchased a new manufacturing facility. As to this date no one has found real third party verification of that purchase other than a small piece from Ft. Wayne, In Journal Gazette which only quotes Peter Collorafi, president and chief executive officer of Revenge Designs.

On January 29, 2008 in the PR  Revenge Designs, Inc. Processing Preliminary 4-Year, $80M Production Contract Revenge Designs announced a preliminary 4-year contract valued at $80M is currently being processed. (Not signed… processed)  In that same PR Mr. Collorafi also stated, ”This is just the first of three pending contracts we have previously stated that we will seek to deliver to our shareholders in 2008.”

I think the $80 million contract referred to in that PR was going to be with Factory Five  and the building of GTM-Rs. It is also my belief that Revenge ran into so many flaws in Factory Five’s kits that Mr. Collorafi reached the opinion that it would be better to totally design a car in house and avoid those time consuming flaws. (more on that later)

On March 14, 2008 Revenge Designs released a PR titled Revenge Designs, Inc. Enters Second Phase of Its $80M Production.  In this PR Mr Collorafi projected anticipated construction of up to 1,000 GTMs over 4 years, and that construction of new building would have to take place in order to assemble that many GTMs. At that time Mr. Collorafi still thought it would only take approximately 3 months to build a GTM.

On April 11, 2008 Revenge released a letter to shareholders. It contains information about producing the GTM Supercar by Factory Five Racing, notes negotiations with one of America’s largest Dealer Networks are taking place, and the famous statement “If just for a moment, day traders, shareholders and previous toxic investors could just take their finger off the sell button and let their investment breath, I am sure growth and stability would occur.” (which when I wrote “Revenge Designs (RVGD) Scam or the Real Thing? You Decide” I thought he was referring to the wrap-around agreements, but now know he was referring to conversion of the original loan from Signature Leisure and K&L International Enterprise)

On May 02, 2008 in a  Corporate Update Mr. Collorafi states that the company has submitted its architectural plans to all relevant state and local approval committees to obtain the necessary building permits for its new 20,000 square foot production facility. The company expects the process to be completed in 4 to 6 weeks at which time the company will begin issuing requests for bids to local area contractors.  No third party verification of this was found.

On July 30, 2008 in a Progress Update Revenge Designs give the first public indications that there has been problems with putting together the GTM.  Stating Revenge was having to do some extensive redesigning and fine tuning on the GTM build.

It is my opinion that around this time Mr. Collorafi has began to realize that building the Factory Five GTM kits is more trouble than designing and building an in house designed car from the ground up.

On November 26, 2008 in a Progress Update Mr. Collorafi announced that a venue had been booked and the GTM would be unveiled in December 2008.  This didn’t happen, but I believe that the opportunity became available to unveil the GTM-R at the North American International Auto Show held in Detroit, and it was determined that was a much better place to debut  the GTM-R.

I believe that just about takes care of the bad dealing with previously published press releases.

Now lets talk about the “GOOD”.

In January 2009 the GTM-R did debut at the North American International Auto Show, held in Detroit, and drew media attention from around the world. ( I personally believe that Mr. Collorafi had already come to the conclusion that producing “kit cars” that had to be extensively redesigned and fine tuned would be less profitable than designing and building a car from the ground up.) What I do believe that Mr. Collorafi truly got from the North American International Auto Show, is the knowledge that there was a large amount of interest in an American Built Supercar.

Then on April 22, 2009 Revenge Designs Inc. Signs Agreement With 110 MPGe Engine giving most of us our first knowledge of Douglas Palmear and his HP2G engine.It was at this time that Mr. Collorafi also announced to the public that producing the GTM-R Super Car will not continue. “It is simply not feasible to produce a vehicle that is not entirely designed in-house and requires such a considerable amount of reconstruction and design”, stated Peter Collorafi. Mr. Collorafi went on to say that Revenge Designs will replace the GTM Super Car with the “Verde Super Car” being ready in December 2009 and would be followed by producing a Super Saloon vehicle in late 2010 that will accommodate the four-door passenger car market.

In October 2009 Revenge Designs announced that renderings of the Verde Super car would debut in the December 2009 issue of the Dupont Registry.

Then on November 20, 2009 Revenge Designs stated they had completed discussions and the final decision is set on the location for the first of many Revenge Certified Installation Centers. A full press release stating location and financial assistance will be announced December 1st 2009.

So Tuesday December 01, 2009 I believe we can expect to see that press release which states the location and tell about the financial assistance that will be provided for that first installation center.

I do not think that the December 01 press release will give details about who Revenge’s associates are, but I do believe those associates are in place and are a good fit with Revenge Designs.

With Carnes and friends no longer being involved with Revenge Designs, may be the best of the good news involving Revenge Designs.

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I own stock in Revenge Designs (RVGD)! All purchased by me on the open market. I am not being paid by the company or any third party for writing about this company.

This story was written over the Thanks Giving holidays and I was not able to get any of the Saleen Departments on the phone…  I have now talked with Saleen Performance Vehicles and they deny  any association with Revenge Designs.

In the November 29,2009 press release Revenge Designs Inc. CEO/President Peter Collorafi stated, “We are extremely fortunate to have a team of unsurpassed professionals working towards the Revenge Verde Supercar delivery, to the Detroit International Auto Show January 11th through 24th 2010

“Our associated team have years of hand sculpting experience in the Automotive Industry, providing their talents and skills to all the Big 3 Automakers and now Revenge Designs is proud to be added to that prestigious list.”

I have been mulling over that last sentence of that PR ever since; turning it over in my mind while trying to figure out just exactly who those associates might be.  My thoughts went back to the ad in the DuPont Registry where  it says “If that sounds like a Ford GT to you, you’re not off the mark as Collorafi has lined up many of the suppliers who were associated with the late Ford super car.

I also know that the Revenge Verde will be a mid engine car same as the Ford GT and that Saleen Special Vehicles (SSV) produced as many as 15 complete Ford GTs per day during their peak production run.

2005 Ford GT built at Saleen Special Vehicles

Now known as Saleen Performance Vehicles, Saleen Inc. was acquired by M.J. Acquisitions Inc in February of 2009 Saleen Special Vehicles today boasts a single assembly line outfitted to accommodate mixed-product production, a high-efficiency paint shop capable of high-bake paint cure processes, fabrication shop, and specialty car assembly area.

The Design Director of Saleen Performance Vehicles is David Byron, who joined the Saleen executive team in the sping of 2009. Prior to joining Saleen, Byron was senior designer for American Specialty Cars (ASC) and designed the 2005 Malibu SS and 2008 Buick Lacrosse Super Edition. He interned at GM’s North Hollywood Design Studio.

Dodge Viper

I almost forgot to mention the work Saleen Performance Vehicles is doing on the Dodge Viper…. Hmmmm I do believe that covers the “providing their talents and skills to all the Big 3 Automakers” statement.

Of course I have not been able to confirm that the association that Revenge Designs President and CEO Peter Collorafi spoke of in the November 29th PR is with Saleen Performance Vehicles, but it sure appears that it would be a good match.

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