<<The structure of the deal was based on previous share prices: when they didn't obtain approval in July, the stock tanked to $4... hence for this deal, Lehman felt comfortable being given a FLOOR of conversion at 25% less than that $4 price, namely $3. Period.>>
Rich, as a seasoned investor in floorless junk, I would think you would know what one looks like by now. Following is the language from SNRS's deal with Lehman. During February 2000, THERE IS NO FLOOR. Period. Not only that, but Lehman can pick and chose the 10 worst prices in February, and convert at 75% of the average.
1.8 "Conversion Price" means:
(A) for the period after February 29, 2000, 75% of the average of the ten (10) lowest Market Prices during the month of February 2000; provided, that such Conversion Price shall not be less than $3.00 or more than $13.67;
(B) for the period from the tenth (10th) trading day in February 2000 until the end of February 2000, the Conversion Price shall be 75% of the average of the ten (10) lowest Market Prices during February 2000 up until the applicable conversion date; and
(C) for the period prior to the 10th trading day in
February 2000, the Conversion Price shall be $13.67. |
