Different floorless issues have that charting pattern,
A beginner's question:
I see from PPRT's 10K that there's a maximum number of shares to be issued (2,776,594). Does this mean that this isn't really a floorless? Or am I misunderstanding this:
As of June 29, 1999, 10,000 shares of our Series A Convertible Preferred Stock were issued and outstanding. Each share of the Series A Convertible Preferred Stock is convertible into such number of shares of Common Stock as is determined by dividing the stated value ($1,000) of the share of Series A Convertible Preferred Stock, which value is increased at an annual rate of 6.0%, by the current conversion price. The conversion price prior to October 4, 1999 is $8.55 and after October 4, 1999 is the lessor of $8.55 and 100% of a measure of the market price of the Common Stock at the time of conversion. The maximum number of shares of Common Stock issuable upon conversion of the Series A Convertible Preferred Stock is 2,776,594. If we issue 2,776,594 shares of Common Stock on conversion of the Series A Convertible Preferred Stock, the remaining outstanding shares will be redeemed by us on or before June 4, 2001 for a price of 103% of the stated value plus a premium of 6.0% of the stated value per year. In addition, as of June 29, 1999, 2,545,343 shares of Common Stock were reserved for issuance upon exercise of our outstanding options and warrants. Accordingly, purchasers of Common Stock could therefore experience substantial dilution of their investment upon conversion of the Series A Convertible Preferred Stock and/ or exercise of our outstanding options and warrants.
If there's 10,000 shares of Series A Preferred @ $1,000 face per, convertible into 2,776,594 common then this means that the minimum conversion price would be a little under $4, right? Am I right in thinking that shorting below this amount would no longer be riskless to the convertible holders? |
