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.

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

To: STK1 who wrote (35255)	6/25/1998 9:17:00 PM
From: William Harvey	Respond to of 41046

Charles, The short answer is that JNC will have 660k shares, if they haven't been selling their conversions. There's another scenario. Most of the preferred holders are also holders of the exercisable warrants. The difference between the two is that the preferreds are like options because they are valued at 25% above the average closing price for the last 20 trading days. The number of shares varies inversely with the price of stock. The warrants are like stock because their price is fixed based on the price of FTEL. Also there are a fixed number of shares. Let me emphasize that I don't believe hardly ANY shares have been converted by the preferred holders so they're holding $7.7M in options, worth 3M shares. Look at it this way: Since the first conversion day, we've had about 80 trading days but the price was higher so you might say that since March 1, there were 2M shares to be converted or 25k sells per day. Well, we've had a lot of days where that many shares weren't traded, so maybe some shares have been converted but when the preferred holders get their warrants out, they can create a vacuum by selling shares that were created by the warrants and as the price rebounds they can sell the conversions on the way up and make twice as much money. It's reasonable. No one saw them at the shareholders meeting. The question is: Do they want to be shareholders or do they want to be landscapers? WH