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Biotech / Medical : Continental Home Healthcare -A Demographic Play -- Ignore unavailable to you. Want to Upgrade?

To: Edward W. Richmond who wrote (25)	3/4/1999 2:07:00 PM
From: Edward W. Richmond	Read Replies (1) \| Respond to of 69

CIMA, issued shares verses fully diluted shares In post #26 I stated that there were 11,453,522 shares (fully diluted) when it should have been shares issued. When I realized my error, I contacted the company to get some indepth information. If all warrants and options are exercised we would have 20,210,330 shares (fully diluted). The exercising of these warrants and options would provide the company with an additional cash of $8.4M. Obviously, the warrants, representing approximately 2.7M shares and with a conversion price of $1.81, will not likely be exercised. If they are, we will all do extremely well. However, I doubt that the stock price will exceed $1.81 in the near future. The warrants that I do expect to be exercised are the approximately 4.8M currently converting at $0.52 and in August change to $0.60. These are the ones that create the dilution that I don't particularly like. However, they will provide additional capital of approximately $2.5M to $2.9M depending upon when they are exercised. The options are priced from $0.80 TO $1.42. As such, they are above the current stock price. I particularly like the very low debt level that CHT currently enjoys. This gives some flexibility in financing future acquisitions. A moderate amount of debt would certainly avoid any dilution concerns. Regards, Ed