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Technology Stocks : p-com (pcms) -- Ignore unavailable to you. Want to Upgrade?

To: Springer who wrote (875)	12/29/1998 9:10:00 PM
From: Bernard Levy	Read Replies (2) \| Respond to of 1461

Hi Springer: You found the key part. If I understand correctly, the convertibles are essentially floorless, since the conversion depends on the stock price of PCMS for 15 days before May 15, 1999. So, if a convert holder can drive down the stock price during this period, it will own a huge chunk of the company. A floor would have required a lower bound on the conversion price. I cannot believe that PCMS management sold its shareholders down the river in such a shameless way. To confirm, I will ask Zeev Hed, the foremost expert on floorless convertibles on SI, to have a look. But as far as I can decipher the language, the worst has come true for PCMS holders. Best regards, Bernard Levy

To: Springer who wrote (875)	12/30/1998 10:56:00 AM
From: Rob Preuss	Read Replies (1) \| Respond to of 1461

Hi All, I just canceled my good-til-canceled limit order to buy PCMS for two specific reasons: 1) All these press releases. Normally, I'd be happy to see them crowing about their sales but I have to view press releases about these teensy-weensy orders suspiciously... until recently it has not been PCMS practice to announce every little sale to the press, nor to issue press releases almost daily. My gut says that something's not kosher. 2) This floorless convertible stuff. I can't say I fully understand the convoluted language on the conversion pricing [why do they say: "...at the lower of (i) 200% or (ii) 101% of..."? Isn't it true that 101% is ALWAYS lower than 200%?]. But there appear to be some powerful forces present who have strong incentives to create pressures (upward or downward) on the stock price; until I'm certain that I understand all this, I will feel better sitting on the sidelines. More generally, I've got little trust in PCMS current management. I've been long on their competitor, DMIC, several times over the years largely because I trust their management. DMIC has stayed away from the P-MP market (so far) and concentrated on developing their core product line with high/low capacities, long/short ranges, and a multitude of frequencies; now, when a salesperson calls on a customer, s/he can offer a full line of products and the customer can deal with fewer vendors. PCMS seems to have made a big bet on P-MP; while this has promise in some markets, its not needed everywhere... I think DMIC has been wise to stay out of P-MP until the market for these products matures. The best hope for PCMS shareholders may be for a buyout by DMIC or by one of their bigger brethren (like Siemens). Perhaps this "bandit" who bought the Convertible Preferred Stock is simply planning to gain controlling interest in order to force such a sale (or to send management packing). It worries me that PCMS management isn't buying their own stock at these seemingly low prices. Rob