MRV Communications (MRVC) opinions? Message Board

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Technology Stocks : MRV Communications (MRVC) opinions?

MRVC 9.975

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Aug 15 5:00 PM EST

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To: Duffeck who wrote (32046)	5/16/2001 8:49:49 PM
From: akmike	Read Replies (1) of 42804

I can not imagine a scenario where the bond indenture does not protect the bondholders from dilution. Therefore, there will be an adjustment to the conversion feature that would operate similar to that of the CBOE adjustment for outstanding options when such an event occurs. So the bondholders will not convert until one of the following events: A. maturity when the conversion feature is in the money or B. a call of the bonds when the conversion feature is in the money. MRVC will want to have conversion take place as soon as is possible so they will probably withhold the LMNE distribution until after they can force conversion, but that it not as certain as the above. I think it is only correct that the bonds must be called prior to distribution, because that is in the company's best interest, not because there is an indenture requirement or a regulatory requirement or an accounting requirement...merely sort of a prudent corporate governance type requirement, which could be waived by the Board of Directors for cause. HTH

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