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Non-Tech : Bid /Ask Spreads - Market Manipulation

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To: Jeff Dryer who wrote ()	2/1/1997 9:57:00 AM
From: SE	of 308

To Everyone: I need some help. I have been examing a REG S convertible issue and cannot quite figure it out. The stock is SYCR. First off, the conversion is different than usual as the conversion takes place from April through Oct. There is $7.81 million outstanding and 15% can convert each month April through Oct, with Oct not being 15% as the math wouldn't work out. Anyway, upon reading the about the bond issue in Edgar (the terms have been amended from the original Edgar filing to that listed above) I don't fully understand what is going on. It appears that each bond is convertible and that each bond carries a warrant that is convertible on different terms, but for the same face amount of the bond. Does this make sense? I give you $10,000 and you give me a bond that I can convert at $3.50 per share or at 85% of the average of the last five trading days, and I get a warrant that says I can convert the face amount of the convertible bond at $xxx price. This means that I get back my principal in stock and I have the right to purchase up to an equal number of shares at the set warrant price? Seems to me this double deal, even if staggared over time, could absolutely kill the stock price through dilution and short sales with covering upon conversion. I don't think I am stupid, :) but cannot figure this out. Further, what are peoples opinions to the amendment of terms to provide for a staggared (sp) redemption period. The original issue was convertible at $5.50 or 85% of trailing five day stock average and the amended is $3.50 or 85% of the trailing five day stock average. Seems both sides have given something up and gotten something. What is the general read on this from a dilution standpoint and a run on the stock price. Any help would be appreciated. Thanks, Scott

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