Value Microcaps Motherboard

[gilead23]

MSGI SWTX

I take this to mean they intend to convert the preferred to common as well. There is no reason to hold the preferred since it earned the same 10% rate of return as the note but would be subordinate to other liabilities in the event of bankruptcy. Basically more risk same reward.

It appears the preferred can be converted to common at 1.00 a share which makes more sense given that the conversion is at a 40% discount to current prices.

I don't see that this implies they intend to dump these shares. In Needhams case they already have almost a million shares of the common. Why would they not sell those first rather than going through the conversion? Of course they could be planning to sell them to another institution after the january conference. Its hard to say.

Assuming they do hold the shares I assume they will convert its a bullish sign since equity always carries more risk than debt and it shows some confidence to have them go out of their way to hold more equity.