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Technology Stocks : The New QLogic (ANCR) -- Ignore unavailable to you. Want to Upgrade?

To: Eleder2020 who wrote (18859)	10/28/1998 12:44:00 AM
From: Greg Hull	Respond to of 29386

Ed, <<The 5% is for the ammount of the conversion they hold? Well they really don't hold the shares shorted.They sold them .In this case, couldn't they cover 5% at a time and short as much as they wanted over the 5%. Theoretically they could short 5% a day? No?I really don't know.>> My reading of the terms says that each preferred shareholder can own no more than 5% of the total number of common shares outstanding. I believe some of the Citadel Entities are restricted to 4.9% each. They are not allowed to convert a share of preferred stock if the conversion will cause them to exceed the 5% limit. Shares of common stock must then be sold long to permit enough headroom for further conversion. If they sell short they collect the funds but still are at the 5% limit. The last official reporting of shares outstanding was on 9/4/98 in the S-3 filing. At that time there were 13,852,080 shares outstanding. Tomorrow we will find out the latest figure, and if there is $7M in unconverted preferred remaining, the common stock outstanding should be just under 20M shares according to my calculations. Greg