RE: Shares Outstanding
I was reviewing SyQuest's share dilution when I ran across what appears to be a significant difference in what the EdHeads have reported to shareholders. Their earnings press release states 230.8 million shares outstanding (after exercise and conversion) as of July 31st, while their recent 10-Q states 217.5 million shares outstanding (after exercise and conversion) as of July 31st.
Which is correct? (perhaps 13 million shares doesn't make much difference at this point, however it would be nice if they could at least report the numbers correctly).
Earnings release -
"At July 31, 1998 the Company had approximately 128 million common shares outstanding and approximately 49 million stock purchase warrants issued and outstanding. There would be approximately 230.8 million common shares outstanding if all stock purchase warrants and convertible preferred shares were exercised and converted as of July 31, 1998."
10-Q filing -
"Assuming the conversion of all outstanding preferred stock, the exercise of outstanding warrants and the fulfillment of other existing commitments to issue common stock, approximately 89.5 million additional shares of common stock would be issued based on existing preferred stock and warrant balances outstanding as of July 31, 1998. Total shares outstanding at that date were approximately 128 million, providing a total of 217.5 million common shares outstanding if all convertible preferred stock is converted and warrants and options are exercised."
BTW, because the share price has dropped since July 31st, I'd estimate the current total to now be in the 275 to 308 million share range (depending on which SyQuest statement you wish to believe).
Perhaps someone out there can answer a question for me - What is required of SyQuest in this situation where the (exercised and converted) total exceeds the maximum 240 million shares the company is authorized to issue? Is there a time frame in which they have to obtain shareholder approval for another increase?
Regards - Dale |
