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Technology Stocks : SYQUEST
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To: Rajendra KRISHNAN who wrote (3486)8/3/1997 5:38:00 AM
From: Dale Stempson   of 7685
 
>>>How and when will the new shares hit the market ?<<<

Rajendra, New shares will come from preferred stock conversions, exercising options and exercising warrants. At this time, we simply do not know how many new shares have hit the market.

It is quite reasonable to suspect that there may have been and/or soon will be a number of preferred stock conversions. Recent 5% convertible preferred investments brought in something like $33 million to Syquest and can be converted now.

If I recall correctly, the shares have a cap somewhere near 2-3/8 which would allow the holders a 15% to 20% short-term gain if the shares were sold in the 2-3/4 to 2-7/8 range.

This is not a bad return given the fact that: 1) the preferred stock also earns interest at a 5% annual rate, 2) the investors have only been holding the preferred for only about 90 days, and 3) the investors were given a free SYQT warrant for every dollar they invested.

Regards - Dale
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