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Microcap & Penny Stocks : MSGI Marketing Services Group Inc -- Ignore unavailable to you. Want to Upgrade?

To: Kurt_Ruckus who wrote (170)	3/30/1999 7:41:00 PM
From: James Thompson	Respond to of 244

Glad to be here Kurt. I am looking for a long and prosperous relationship with MSGI. However, if things go as we envision, this board will have to be moved from the Under $5 board. Jim

To: Kurt_Ruckus who wrote (170)	3/30/1999 9:56:00 PM
From: Austin S.	Read Replies (1) \| Respond to of 244

GE Capital Conversion: Correction re: number of days. On Dec. 24, 1997 MSGI and General Electric Capital Corp. entered into a purchase agreement of 50M shares of convertible preferred stock and warrants to purchase up to 10,670,000 shares of Common Stock, all for the price of $15 million. The convertible preferred stock is convertible into shares of Common Stock at a conversion rate that, as of 3/31/98, was about 89.02 resulting in the beneficial ownership by GE Capital of 4,451,177 shares of Common Stock or about 24% of the issued and outstanding shares. The Warrants are not exercisable until Nov. 2001 and are also subject to reduction or cancellation based upon MSGI's meeting certain financial goals or upon the occurrence of a secondary offering. The Convertible Preferred Stock is convertible at the option of GE Capital at any time and at the option of MSGI at any time the current market price equals or exceeds $8.75 per share for at least 20 days during a period of 30 consecutive business days or upon the occurrence of a secondary offering. My understanding is that if MSGI stays above $8.75 for another 17 out of the next 27 business/trading days then GE Capital can be forced to convert and at a better conversion rate. This will do two things: 1. give GE Capital something a little less than a 24% ownership and 2. will eliminate and further dividend/interest payments to GE Capital. As has been noted, MSGI posted a loss of .37 last year and .31 of that loss is attributable to the recording of a non-cash, non-recurring divident payment of $3,214,400 to GE Capital, which amount represents the difference betweent eh conversion price of the Convertible Preferred Stock and the fair market value of the common stock as of the date of the agreement with GE Capital. Forcing the conversion and maintaining a stock price above $8.75 (which seems inevitable) means MSGI will likely be making more money/profits in 1999 and 2000 than anticipated. This is a good thing.