Question to all regarding lockup expiration: Here is an excerpt regarding the upcoming expiration:
Sept. 22, 1997, CIENA Corp. (CIEN) reported that lock-up agreements affecting about 22,900,000 common shares will expire at the close of business on September 29.
At that time, CIEN said an estimated 17,500,000 of the shares released from the lock-up will be "freely tradable" at the start of trading on September 30. The remaining estimated 5,400,000 shares also will become tradable at that time, "though subject in certain cases to vesting restrictions and Rule 144 limitations."
CIEN noted that the lock-up agreements were associated with the company's secondary offering of July 2. As reported, CIEN completed a public offering of 9,110,622 common shares, including 1,000,000 for the company, at $44 each on that date.
Originally, I wasn't too worried about this lockup expiration, becuase I thought that it was all due to the recent secondary offering being unlocked, and since these investors purchased shares at $44, there would not be a tremendous selling pressure. But the numbers say that 22.9 million shares are unlocked, but the secondary only involved 9 million shares.
Can anyone account for this discrepancy? If millions of shares from the original investors are unlocked on Sept. 29 (purchased for pennies per share), then we may truly see quite a bit of heavy selling. |
