SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : INPR - Inprise to Borland (BORL)
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Mark Bracey who wrote (766)7/31/1998 7:54:00 PM
From: Jerry Whlan  Read Replies (2) of 5102
 
To the extent that the trading price of Common Stock is lower than $6.94 per share at the time of any conversion of the currently outstanding shares of Series B Preferred Stock, the number of shares of Common Stock issuable upon such conversion will increase.

In my experience, this sort of clause is death for a stock price.
My most recent experience with this kind of situation is QDEK.

Basically, there is now no reason that the owners of the Series B stock can not just short the hell out of the common stock and cover with the future conversion of their preferred stock. The more INPR goes down, the more shares they will get at conversion to cover their shorting. This makes it easy for them to short more shares than they already "own" via conversion, which can cause a lot of dilution.

The only thing that could combat this effect is strong earnings, which we don't have. QDEK had losses and experienced massive dilution (on the order of 75% additional shares) due to a similar placement.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News