Hi gang,
Here is my NEOP theory...
Concerning NEOP:
SEC dated FEB 1st 2000,
"On January 19, 2000, the Registrant sold its equity investment in XTL
Biopharmaceuticals Ltd. ("XTL"), consisting of 2 Class A Common Shares, par value $.020 per share, of XTL and 170,650 Class A Preferred Shares, par value $.020 per share, of XTL, to an Israeli investor for $1,500,000."
There has been no public announcement on this matter just yet. Ask yourself why close Jan 27th...file Feb 1st and not announce "YET"...The conversions are being negotiated IMO and we are close to a public announcement.
SEC dated Sept 30,1999
"Generally, each share of the Series B may be converted, at the option of the owner, into the number of shares of common stock calculated by dividing the sum of $100 and any unpaid dividends on the share of Series B by the conversion price. The initial conversion price of the Series B sold is $1.03 per share of common stock. If, on February 16, 2000, the market value of common stock is less than $1.03, the conversion price will be reset to the market value of a share of common stock on February 16, 2000, but not less than $0.515. If the market value of common stock is less than $1.03, the conversion price will be the average of the three lowest closing bid prices for a share of common stock during the previous 10 trading days. The Company may refuse to convert a share of Series B that the Company sold if its conversion price is less than $0.55. However, if the conversion price of a share is less than $0.55 for more than 60 trading days in any 12-month period, then the Company must either convert a share at the share's conversion price or pay the owner cash based on the highest closing price for common stock during the period from the date of the owner's conversion request until the payment."
"POTENTIAL REDEMPTION OF SERIES B: On July 28, 1999, the NASDAQ Stock Market, Inc. delisted the Company's common stock from the NASDAQ NMS. Management believes that as a result of events which occurred subsequent to June 30, 1999, the holders of the Series B have the option to request redemption of the Series B. If the Series B holders decide to request redemption, the Purchase Agreement would appear to require the Company to pay the Series B holders approximately $3.6 million. Management of the Company has approached the holders of the Series B in an attempt to restructure the Series B transaction. However, there can be no assurances that the Company will be able to restructure the Series B transaction at terms acceptable to the Company or at all. Management believes the best estimate of the potential settlement value to be an amount consistent with the $3.6 million redemption value stipulated in the Purchase Agreement."
"At September 30, 1999, the Company had access to approximately $3.8 million in unrestricted funds to finance its operating activities. The Company expects to generate positive cash flow from operations in the near term, possibly as early as the fourth quarter of 1999, as a result of the Distribution Agreement with EES."
There has not been a forced redemption when there is clear grounds for such event. Why. Because these converters make the real money by converting at .55 and such & selling back into the marketplace at $1 plus...This isn't rocket science...See ASTM & ARIA to understand this.
So why have't they forced conversion. Hardball negotiation. There are stipulations in NEOP's charter that prevent the issuance of an excessive no of shares. Again the converters could force redemption but they cut off their nose despite their face. So my theory is there will be a meeting of the minds. We will see something like half conversion & half redemption.
Watch the SEC files for a registration of securities. It will tell you what to expect so act fast I intend on entering a second position based on that data.
Also I expect a series of news events over the next 15 days leading up to and after the earnings report. This will create the news story effect ( see ARIA & ASTM) to move an anticipated 3 million shares or so.
No I do not expect anything on the scale of ARIA. While NEOP is looking to turn profitable it did not recieve 40 million in cash either. The thing you must keep in mind it is the converters who move the stock.
See ARIA SEC dated Jan 18th 2000,
1. That, at the closing (which was held on January 15, 2000), the Registrant (a) repurchased from Promethean Group 2,388 shares of
Series C Convertible Preferred Stock, par value $.01 per share (the "SERIES C PREFERRED STOCK"), for an aggregate purchase price of $6,925,000, and (b) accepted for conversion from Promethean Group 612 shares of Series C Preferred Stock, which were converted into 1,078,038 shares (the "SETTLEMENT SHARES") of the Registrant's common stock, par value $.001 per share (the "COMMON STOCK");
Note ASTM did a massive conversion & they still got $2.5. PCTH is doing a reverse conversion play. They pumped the stock up pre March 7th annual shareholders vote on dilution on the order of 10 to 20 million shares. So they pump it up & short sell with offshore accts IMO. Two day volume of close to 20 million shares already. Do ya think it is over. Naw ya have anothers month worth of pump & dump stuff. Then the wammo down the road...Enjoy the ride...Then cover with their massive conversion dilution later on. Imagine if they short sold at avg of say $3 & convert at say $1 or less...Get the idea...Of course there are other possible scenarios...I doubt it at this time... : )
BEST WISHES
Jeffrey
|
