Osicom(FIBR) Message Board

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Technology Stocks : Osicom(FIBR)

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To: Scott Ozer who wrote (7082)	6/2/1998 9:16:00 AM
From: Bryon Bothun	Read Replies (2) of 10479

I have a question about possible convertion scenarios. This latest placement cannot be converted for 90 days minimum. As far as First Boston is concerned the price over the next 67 days makes absolutely no difference. They convert at the lower of $7.99 or the average of the lowest three closing bids for days 68-90. There is also a provision that FIBR can buy back the issue at 116% of face if the price closes below 3.5 for ten consecutive days. My question is, under that scenario when must they do the recall? If it closes below 3.5 for the next ten days does this give them the right to redeem it only on the eleventh day or at any time in the future? If this redempton option is open ended this may present an opportunity for FIBR. Say the price goes to $15 on day 67 and stays there until day 90. FB would be able to convert at $7.99 and sell at 15$ for close to a 90% return. FIBR would be better off to recall it at that point and pay FB $9.2 million and keep the million shares that would now be worth $15 million. FB still gets a nice %16 return and FIBR gets the use of the money to ramp up without diluting at all. Pretty smooth for FIBR if it works out that way. Is this a possible outcome? Thanks Bryon

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