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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Big Dog who wrote (42315)	4/15/1999 11:28:00 PM
From: WWS	Respond to of 95453

"Inexhaustible" supply of "deep oil" under Eugene Island? This mystery from the GOM is discussed in a new feature article from tomorrow's WSJ: interactive.wsj.com

To: Big Dog who wrote (42315)	4/15/1999 11:38:00 PM
From: DEER HUNTER	Respond to of 95453

I don't know about "double dog pissed"...but I am a bit miffed. Oh yeah....and a bit worried. DH

To: Big Dog who wrote (42315)	4/15/1999 11:42:00 PM
From: BigBull	Respond to of 95453

Now wait just a dog gone minute, o mighty King Canine! When I read that post my reactions were pretty much the same as yours .... "Why those dirty low down sons o @#$%^^##%%^^!" "I'm outta here tomorrow morning at 9:30 am" etc etc Then I reread it. FLC has the "option" to pay dividends in stock not CASH for the first five years. It does not specify whether the stock dividends will also have warrants attached. I'll bet dollars to donuts the investors get paid in nothing but illiquid (probably untradable) stock for the whole first five years. What do you want to bet that these convertible shares are redeemed long before that five years is up if the investors have not already converted. Yeah the 9.50 conversion price sucks, but FLC probably had to give em that to get out of paying cash dividends. Bottom line; what we got here? 300 million in - no CASH out. Not such a "desperate" "give away" deal after all imo. I for one would NEVER buy a convertible preferred that didn't pay dividends IN CASH. In my view this not not not the slam dunk up against the wall deal some may think. In fact the investors stand the very real risk of coming away with zero. My question to you and the thread is this. Since what they are issuing are not non callable bonds can't FLC redeem or call these shares at any time? And do the "like kind" stock dividends have warrants attached?

To: Big Dog who wrote (42315)	4/15/1999 11:48:00 PM
From: mph	Respond to of 95453

Since I still own some FLC, thanks for the info--I guess.<g> mph

To: Big Dog who wrote (42315)	4/16/1999 12:51:00 AM
From: SliderOnTheBlack	Read Replies (1) \| Respond to of 95453

FLC/Put me in the ''double-dog-jealous'' camp - 13.875% and $9 bucks ! Wow.... why would ANYONE own the common with those terms ? Unfortunately, this is a private placement - the rich get richer once again.... Talk about ''preferred'' - damn, these are ultra preferred ! How about locking in a near in the money option - and getting 13.875% while you wait...sure you might get paid more pref stock instead of cash (more dilution folks) but talk about a ''preferred'' position to common - wow ! dilution - not a good thing by the way...but appears moderate. I'll double underline my view of FLC as ''speculative'' ... 13.875 % interest - 13 % ??? The analysts will run the model on dilution vs. FLC's upside. Without any unforseen major rig cancellations the upside potential longterm is still very, very substantial; but the dilution is moderately negative and the downside is not a pretty picture... perhaps; Webster failed to deliver all the cash on more favorable terms - evidently the prior bond deal was not all the $ they needed and this loan shark deal for the last $300 Mill is the reason for his ouster ? I hope to see analyst model revisions and their take on this - dilution will be the story - the warrants are for 10.5 Million shares and if they do not pay the 13.875% on the $300 Mill in year one with cash - it would be another 450K shares - 4.5 Mill +/- potentially over the entire 10 years ?; 193.4 Million shares issued now with a float of 145 Million. So the dilution is not massive, but yet it is not inconsequential. We will see in the morning what the Street thinks.... perhaps the $300M covers the potential of a cancelled deepwater contract and virtually guarantees their liquidity through the next 18-24 months. This liquidity guarantee may far outweigh the dilution aspects and may be viewed as good news. - hard to think that this surprised Wall Street, my initial view is that this had to be known by many and may allready be factored into the stock price. Bottomline; --- Where do I get my ''preferred'' ? Too bad it's a private placement - I'd be in the preferred in a hearbeat...also; in looking at the option activity in FLC today - a good barometer on the smart/inside money; 1376 calls written vs. just 120 puts...hmmm - perhaps the Street liked the removal of the liquidity risk better than the moderate dilution... We'll know in just 8 short hours (VBG) ...

To: Big Dog who wrote (42315)	4/16/1999 5:07:00 AM
From: Ditchdigger	Read Replies (1) \| Respond to of 95453

Re: FLC,Actually I thought FLC made it quite clear they required additional cash(on top of the $1bb)..Also recall some analyst stating FLC had all the cash they needed,,once again the analyst was wrong, or simply overlooked the fact..The big question,is this enough cash? Was this placement made instead of the proposed "project financings" mentioned in a prior release to raise additional cash? Is this placement the "project financing" referred to?DD '''''''''''' PS: after the $1BB bond placement "Steve Webster, R&B Falcon's President and Chief Executive Officer commented: "This offering reduces our reliance on bank financing and planned project financings, the timing of which had been delayed. While we still plan to complete project financings for the Deepwater Frontier, which is jointly owned with Conoco, and the RBS-8M, timing is now not as critical since proceeds realized will be used to enhance our liquidity reserve. We believe this financing ensures that R&B Falcon can complete the industry's largest deepwater construction program and maintain a comfortable liquidity reserve even under the current weakened market conditions the industry is experiencing." Was this $300mm the project financings referred to in the prior PR? go2net.newsalert.com

To: Big Dog who wrote (42315)	4/16/1999 8:33:00 AM
From: marc chatman	Read Replies (2) \| Respond to of 95453

<<The boys who bought this preferred stock, and I know who they are, have just cut the proverbial hog.>> Big Dog, without asking you to divulge who these boys are, I have a couple of questions. Are these buyers likely to have checked out first hand the progress on the new builds in order to make a good judgment whether they will come in on time and on budget? And, are they likely to have good information on the status of drilling contracts? Perhaps we can make some assumptions as to FLC's situation if we can answer these questions. As a general note, this preferred issue was no surprise. The company in previous filings dating to last year indicated they would be attempting to issue $300 million in preferred securities (although I believe they initially thought they would be doing it in the 4th Q of '98). If these buyers are as "smart" as I think they may be, I would expect a nice little move in FLC. The short-term picture is only getting better, in terms of some risk being taken out of the equation. Longer term, however, they appear to have taken a slice out of my pie. Another consideration is the possibility that the warrant holders will hedge at some point north of 9 1/2 by shorting 10 million shares. I'll be reassessing how long to hold this, but I'm not in any rush to sell.