Mandatory conversion
Mandatory conversion
Posted Mar 18, 2004 3:29 UTC (Thu) by corbet (editor, #1)In reply to: SCO Update by error27
Parent article: SCO Update
Actually, I was going to put a paragraph about that into the article this week and forgot. A lot of people have misunderstood the conversion language.
In particular, the agreement allows SCO to force conversion of the stock if the stock price goes below half the original price. It's SCO's option. There's nothing that I've found that allows BayStar to pull its money if the stock price falls.
Posted Mar 18, 2004 18:45 UTC (Thu)
by jwb (guest, #15467)
[Link] (3 responses)
The previous holders of the Series A Preferred Stock have been converted, as of February 5 2004, to holders of Series A-1 Preferred Stock. They now have voting rights and seats on the board, which means the holders of Series A-1 can vote to force the company's hand on the cash conversion.
Posted Mar 18, 2004 19:10 UTC (Thu)
by jwb (guest, #15467)
[Link]
Posted Mar 18, 2004 20:53 UTC (Thu)
by error27 (subscriber, #8346)
[Link] (1 responses)
How does the voting work? Yarro and Canopy together have 11 out of 14.3 million SCOX shares. Wouldn't their votes automatically out vote everyone else?
Posted Mar 18, 2004 21:31 UTC (Thu)
by jwb (guest, #15467)
[Link]
From SCOX 10-Q filing, emphasis added:
Mandatory conversion
The value of the Series A is classified outside of permanent equity because of certain redemption features that are outside the control of the Company.
I should also note that the Optional Redemption trigger point for Series A-1 shares has been moved up to 20 days closing below $10.50.
Mandatory conversion
I'm not very familiar with how all this works...Mandatory conversion
The Series A/A-1 Preferred shares are worth $1000 per share and have commensurately larger power. The common stock is owned by Yarro et. al.
Mandatory conversion