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

To: Rob Preuss who wrote (1083)	5/19/1999 5:39:00 PM
From: Bernard Levy	Read Replies (1) \| Respond to of 1461

Rob: At this stage proposing a precise scenario as to what will happen to PCMS is extremely difficult. One key event is the shareholders approval in June which would allow PCMS to issue more than 20% in stock to the floorless convert holders. The 20% limit is imposed by the Nasdaq. If shareholders refuse to approve this waiver, then the floorless holders can force PCMS to trade in the pink sheets, where no such limit exists. So what will the floorless holders do? Wait until the shareholder approval is secured in June and then short the hell out of the stock with a bottom below $1. Or short now, and drag PCMS in the OTC market if sareholders are recalcitrant. The second approach might result in a long litigation, so I would expect that the damage to PCMS will occur after the shareholder approval to waive the 20% limit. Note that in spite of the floorless issue, shorting PCMS might be equally dangerous, since P-Com could easily be put up for sale. The company has the option of paying back the $15M it borrowed plus all sorts of interest and fees. It is easy to imagine a situation where a buyer could come in and buy out the convert holders. Figuring out how this one will play out is extremely difficult. However, when the floorless convert, I would say PCMS will be a buy at that time (it might be at an insanely low price). Best regards, Bernard Levy

To: Rob Preuss who wrote (1083)	8/26/1999 5:24:00 PM
From: Bernard Levy	Read Replies (2) \| Respond to of 1461

Hi Rob: I am trying again to analyze PCMS's prospects. The short interest jumped to 6.3 millions shares short. The balance sheet of PCMS looks like a mess. Yet, when one looks at NTRO, the current PCMS price looks very low if PCMS is successful in rolling out its P-MP equipment. One element contributing to the current pessimism has been the hype surrounding the 100Mbp/sec wireless fast Ethernet system developed by Triton Systems and rolled out by ARTT. This system works by connecting high capacity P-P links in a ring, so it is similar to a LAN, but without wires. Other equipment manufacturers are also selling OC3 P-P links intended to set up similar ring architectures. I am skeptical of these solutions, since they are expensive, thus losing the cost advantage of wireless deployments. If a building needs an OC3, it might be better served by fiber. For small buildings, P-MP remains the preferred solution, IMO. I am still on the sidelines, and I am struggling to determine whether the current low price is a buying opportunity or a sucker trap. Any thoughts? Best regards, Bernard Levy