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Technology Stocks : FBN Associates - Year 2000/Y2K IPO!!!
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To: Jeffrey S. Mitchell who wrote (396)4/1/1998 4:43:00 PM
From: Andrew Vance   of 2770
 
Jeff, when my preferred shared triggered you would have to be a fool not to take the profits and run. If the stock should retreat tomorrow, we lose a very valuable conversion. Therefore, I exercised the conversion and shorted the stock. Worst case scenario is losing profits on 800,000 shares if it runs above $85. My math on this is as follows:

Preferred shares: 100,000 at $10 = $ 1 million
Conversion at 8:1 (800,000 shares) shorted at 83.25 = $66.6 million

Any run up tomorrow could be covered with warrant exercise and sale but I think we are going to tank the stock due to short interest created by this conversion and the doom and glooers out there. Therefore, if the stock tanks and I think it will, I will cover the short, retain the 800,000 shares post conversion, and pocket the delta.

AV
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