Floorless Preferred Stock/Debenture Message Board

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Strategies & Market Trends : Floorless Preferred Stock/Debenture

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To: SnowShredder who wrote (67)	9/2/1998 12:31:00 PM
From: Zeev Hed	Read Replies (3) of 1438

No, you missed the point. The $12 MM preferred is a "draw down" line of credit. The conversion has a ceiling of $14 or so, but if the price of the stock is lower, the conversion is at the average of the last 20 trading days, thus it is a floorless. The advantage is that Genzyme will have great difficulties explaining engaging in the normal floorless tactic of shorting against the block, but the increasing dilution will still be there as the stock goes down. Zeev

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