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To: james a gustino who wrote (3982)	10/29/1998 8:58:00 AM
From: Seconds Out	Respond to of 10081

Your points are well taken. I echo your sentiments about the Preferred Shareholders as well. I just didn't want to be the first to say it so directly. I have been somewhat of a cheerleader lately, you know. Seconds Out.

To: james a gustino who wrote (3982)	10/29/1998 11:58:00 AM
From: Ray Rueb	Read Replies (3) \| Respond to of 10081

RE: Significance of recent 8-K filing Seconds Out posted: << I also still wonder about the significance of the Preferred shareholders trading the $19.49 fixed conversion price for the $10 price. Why did they agree to that change in consideration for GMGC's right to dilute their share value by up to 5% per year when the stock is trading at a conversion price far below that today? >> james a gustino posted: << the agreed reduction in the preferreds' fixed conversion price to $10.00 strikes me as a promising development. it suggests IMHO that the preferreds believe that whatever future development the 8-K hints at, they fully appreciate the potential significance of same and are willing to permit dilution of their shares in such event. it further suggests IMHO that the preferreds believe that such development will likely lead to the share price substantially in excess of $10.00. what other motivation is there for the agreement of the preferreds to allow dilution of their shares??? >> Lets say I'm a big investor (obviously not me), I've just purchased a bunch of preferred stock at $12 with conversion in 5 months at $5 to $19. The stock is currently at $15.00, What do I do? Historical answer: I use my preferred stock as collateral and short the stock. Now lets say I'm that same investor and I'm short the stock at some major profit. I'm within 30 days of beginning to convert my preferred stock. The stock is currently at $6.00, What do I do? Suspected answer: Do whatever I can to get the stock price below $5.00 in 30 days because we won't be above the $19.00 at time of conversion. Now lets say the company offers to lower my maximum conversion price down to $10.00. Now I have some incentive to get the stock price over $10.00. But I'm still short lots of stock. The stock is currently at $6.00, What do I do? Suspected answer: on the next downturn, cover my shorts, use my profits to double down (buy more stock) and let the stock price rise. This 8K has to be the reason for the delay in earnings report: Markman is putting the right incentive in place so the devil will also want the stock price to rise. The delay also gives big investors time to switch their positions from short to long. Short term, I predict one more slide downward with heavy short covering. Low price: hmmmm... what price would be low enough to trigger capitulation and heavy selling... shaking loose enough shares to allow massive short covering... 4 1/2 didn't do it... so what??? $3.00???. OK, when for low price? I suspect either 1 week before or 3 weeks after this earnings report. Long term, $20 by June. Any comments? Good luck to all. Ray