Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Roger A. Babb who wrote (832)	1/16/1998 4:52:00 PM
From: Hank	Read Replies (3) \| Respond to of 18691

Roger, Is ESMC a company you normally follow? I'm wondering how you happened to read about the convertible deal. Maybe I don't read my papers close enough. What is your reasoning for expecting this to go to $2? I'm sure you didn't just pick this as an arbitrary target. Hank PS- You missed a GREAT party on Jost Van Dyke this year.

To: Roger A. Babb who wrote (832)	1/18/1998 1:52:00 PM
From: Mark H. Bornfeld	Read Replies (2) \| Respond to of 18691

Pardon my ignorance, but I'm a little green about convertible securities. By all the excitement about ESMC, this "floorless convertible" thing is an accurate indicator of a drop in stock price. By "floorless", do you mean the conversion price is not set, so the conversion ratio (if the stock price at conversion time is very low) is unlimited, leading to a substantial dilution of the stock float? And if that's the case, why would those holding the convertible preferred rush to convert them if holding them while the stock price bottoms out would result in them converting to a larger number of shares? (sorry if I'm just not getting it.)