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Strategies & Market Trends : Floorless Preferred Stock/Debenture -- Ignore unavailable to you. Want to Upgrade?

To: N. Dixon who wrote (118)	10/10/1998 4:01:00 AM
From: Roger A. Babb	Read Replies (1) \| Respond to of 1438

Dixon, just as with other types of "creative" financing, how bad the dilutive effect on the stock price of "equity lines" will vary among companies according to other qualities of the company such as if the company has, or ever will have, any earnings or revenues. REFR is a 30 year old company which had only $60,000 in revenues last quarter and large negative earnings. You and I have agreed to disagree on future revenue prospects. Your contention that REFR can somehow make money by manipulating its share price with buybacks is pure baloney. The company will rise or fall purely based on earnings and revenues, economic laws have not been repealed.

To: N. Dixon who wrote (118)	10/10/1998 8:07:00 AM
From: Mama Bear	Read Replies (1) \| Respond to of 1438

"I thought we had clarified on the REFR thread that the recent equity financing gives REFR all the options including setting the floor price and not having to offer one single share under the Class A warrant. " I believe that is an almost accurate assessment of the S-3. The only thing you left out is that Ailorous can't be required to buy unless it is at 92% of the market price. So it is inaccurate to say that REFR has all the options. Also, I believe you never offered a reason why they would go to the trouble of making the deal if they did not intend to sell shares. While I do believe this deal is better for the shareholders than the classic toxic convertible, it still shows that the company can't convince people with money to lend it to them on any but extreme terms. Barb