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Microcap & Penny Stocks : FRANKLIN TELECOM (FTEL) -- Ignore unavailable to you. Want to Upgrade?

To: topwright who wrote (27366)	2/7/1998 9:36:00 PM
From: William Harvey	Respond to of 41046

All, Let me emphasize that no one would profit by a down month. If the last half of the month was strong, then that would be good, but it's still best if the company blasts off! However, if we do have a great month, there may be some selling by the first of the next month. The problem with economics is once it suggests a possible scenario, even the most level-headed feel the boat begin to rock. Let's take an overview of the preferred stock conversion: The investors stepping up the plate March 1 are hoping the price rises above (a) $5 (if it rises 10% above $5, they get 10% more stock) or (b) the average price of the last 20 trading days of Feb. The Feb average price will probably be lower than $5, but who knows? If they have not done their due diligence, there would be a temptation to sell. If they choose to exercise their option, they basically convert to 85% of the average price plus interest and sell at the current price. Should the investors hold on into the seventh month (June), they could buy at 80% of the average price (last 20 days in May) plus interest. This would not be a ten-bagger though! When they hold onto their preferred shares, the value will continue to rise 8% per year on top of whatever gains FTEL's price appreciates and should we go ballistic, so will they. I doubt if I could find a better investment because their original $10k per share is almost invulnerable. Hope this helps. WH