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Technology Stocks : America On-Line: will it survive ...? -- Ignore unavailable to you. Want to Upgrade?

To: Kerry Phineas who wrote (9075)	3/27/1998 8:24:00 AM
From: Sam	Read Replies (2) \| Respond to of 13594

Read a little closer... Under terms of the one-year deal signed this week, AOL will collect $8 million in guaranteed payments, with $32.5 million to follow if Provident chooses to renew for two more years. AOL received warrants to buy up to 300,000 shares of Provident American common stock and also may receive warrants to buy another 450,000 shares depending on how many people sign up online for the insurance. The deal has the potential to be mutually beneficial, with AOL gaining cash and Provident reaching a vast new customer base. Provident's stock recently has been on a wild ride, trading as low as 2-1/8 two months ago, down from a 52-week high of 10-1/2 in April 1997. The stock has been rebounding in recent weeks, but today fell 22 percent to 5-1/4 on news of a delayed audit and an expected loss of more than $20 million for 1997. The company had a net income of $16 million for 1996. Analysts blamed Provident's poor financial performance on one-time write-offs on one hand, and the dismal state of the health insurance industry on the other. In an attempt to return to profitability, the company today announced not only its deal with AOL, but also plans to raise its premium rates and its fees for out-of-network usage. S.