Angel, If Series 3 is a "death spiral" convertible, you should know it before getting in SYQT. If you want to see what one looks like, check CMYN, a gold mining company, that was pushed past the "Schwartzchild radius" by the decline of gold prices last year. While almost every other gold stock has rebounded significantly, CMYN just spiralled in. I lost a chunk of change in it, and sure wish someone had pointed out the "death spiral" clause in one of the SEC filings. It is usually buried under a mountain of legal mumbo-jumbo.
Even if Series 3 is not a "death spiral" convertible, just look at the sheer number of preferred series: 7. They have come back to the well 7 times because they can't get conventional financing.
This stock has gone from 11.5 M shares on 9/30/96 to 94.6M shares on 04/27/98, without splitting. And if all current warrants are exercised the total will be over 163M. That alone is enough to scare any sensible person. But the continuing dilution will almost certainly put the float at the authorized limit by the end of the year. That is why they must authorize more at the shareholders meeting. The number 300 million comes to mind. |
