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Technology Stocks : Apple Inc.

AAPL 259.35

+0.1%

Jan 9 9:30 AM EST

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To: Adam Nash who wrote (23988)	4/14/1999 7:11:00 PM
From: Eric Yang	of 213181

"The fact is, the convertible debt is already included in the "fully diluted" earnings calculation. (Or so I have been informed)' That's correct Adam. The 22.6 million shares equivalent from the $661 million in convertible notes have already been factor into the diluted EPS for the last few quarters. Calling of the convertible notes is a very good thing. I asked Fred Anderson about whether Apple will call those notes by June 1st after the shareholder's meeting and he said that it would be up to the board of directors... but hinted that it would be the logical thing to do. The calling of the notes have a number of positive consequences... too many and complicated in fact for me to discuss in this post. But among the benefits is that it elimates the trading advantage that convertible notes holder has over regular share holders, will eliminate $661 million off of Apple's long term debt and actually add $661 million to Apple's book value. It will save $10.8 million or so in interest every quarter. It also makes it more likely for Apple to repurchase shares. (Once the notes have been converted by June 1st) Eric

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