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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: Larry Brew who wrote (18564)	8/3/2001 12:16:04 PM
From: GVTucker	Read Replies (2) \| Respond to of 21876

The 2006 date is when Lucent has the right to redeem the converts, in essence forcing conversion. If a convert holder wants to convert to common stock beforehand, they can, although that would make little sense. You'd rather get the 8% coupon and own a common stock equivalent rather than just own a common stock equivalent without a dividend. It doesn't really matter on the upside, though. Once the common is past the conversion price, someone long the converts and short the common is essentially just long an 8% coupon. Of course, many hedge funds have also sold off that stream of payments also so that they aren't exposed to interest rate risk, either.