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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG)
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To: Bald Eagle who wrote (43932)12/20/2000 6:08:43 PM
From: ztect  Read Replies (1) of 44908
 
Yep, that's the problem in addition to the
general overall condition of the markets.

Convert holders short using the bonds as collateral
to cover thus hedging against their own investment, and in a down market
with the added burden of margin calls and tax selling
putting downward pressure on volume while increasing sells,
dilution gets worse with every decrease in price.

When I read and understood the terms of the loan,
I said to myself okay that won't be too bad since the
price was then over $1.5 resulting in less than
2 million conversion shares. However, as you've noted
with the decrease in share price the conversion shares
create substantially making dilution much more worrisome
and I, like you, have been recalculating the conversion
share number at these prices.

That's why I've noted on a couple prior occasions that
if Affinity has revenues as "news released" or GS has
any remaining cash it hasn't burned through, that any cash
or revenues be used to pay down, at least, a
portion of the LT debt. If even half of the debt were paid
off then that would be a creation at these levels of 5
as oppose to 10 mil shares.

Morover if such
payment were made, especially in conjunction
with a stabilization or bounce in the overall markets
with maybe another Coca Cola or other
corporate announcement, then
a change in the stocks price trend possibly could
occur with pressure being put on any short positions
further mitigating the dilutive impact caused by the
remaining balance of the LT note becoming
conversion shares.

z
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