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

To: Craig Stevenson who wrote (18998)	10/30/1998 2:17:00 PM
From: Greg Hull	Read Replies (3) \| Respond to of 29386

Craig, <<Are you just using a simple moving average to calculate their conversion price? How many days? I would say that if the stock trades normally, without the big overhead through those target dates, we should be in the clear.>> No, I am using the formula stated in the SEC filings. I'm doing this from memory, so I'll correct any mistakes I make on the following after I get home tonight. >Glazed_Eyes = ON The formula for conversion is: CS = ($10,000/CP)(D/365)(1.08) where CS = Number of shares of common stock CP = Conversion price from formula given below D = Number of days since closing date of offering (2/19/98) The conversion price is the average of the 3 lowest closing bid prices of the last N trading days, where N = 12 + M, where M = Number of months since closing date of offering (2/19/98) The conversion price of Series C preferred shares does not increase smoothly (usually), since the same 3 days are often the lowest for weeks at a time. It now takes about a month to flush a low price out of the formula. Said another way, if someone could get/keep the bid price at the closing low for 2 or 3 days, those shareholders wishing to convert Series C shares would benefit for the next four weeks. We are now working off the low prices from early this month. By 11/17/98 the 3 lowest prices will all be above $1.50 unless we hit the skids between now and then. The last term in the formula expresses the accretion terms. Rather than getting a cash dividend, the preferred shareholders get more common shares at conversion. They accrete 8% annually, earn for each calendar day they own the preferred stock. >Glazed_Eyes = OFF I hope each of you had a nice nap. Greg