Many interesting posts re warrants today.

I can't imagine NOT holding back info to frustrate the warrant holders - this would really be a dumb move. It would lead to litigation, or at least the threat thereof, and would give us a very black eye in the investment community.

If there's no news, there's no news. I suppose if there were a halt tomorrow, pending news, the company might extend the expiration until the day the news is released. Having the stock trading halted makes no difference as the exercise is not a market transaction, but having news immediately pending (or possibly leaked out), could be enough to justify an extension. Don't forget, extending will no doubt upset other people, including many on this board.

The reason I don't think many of the warrants will get exercised tomorrow (unless we see a significant rise in the S/P, maybe to 5.75 at least), is because of the mindset of those who invest in PP's, with warrants attached. Those folk are willing to take a certain amount of risk, and that is less than we retail guys take (forget, for the moment, the amount of money involved, and they generally have lots of that, anyway). The PP game is do your due diligence, get a little bit of inside stuff from the company or the brokers or whoever, and get yourself a discount on the original issuance, and secure 1 warrant for every two shares purchased. That's a very typical deal in the Canadian resource arena.

Let's say you participated in the PP and purchased 100,000 shares at $4, which had warrants attached entitling you to purchase 50,000 more shares for $5. Now, at a time when all the stock restrictions have expired, and hopefully the stock is selling above $5, say $6, you short 50,000 shares, and bank $300,000, you then cover the short with the 50,000 shares you buy for $250,000 when you exercise your warrants. You lock in a profit, $50,000 in this example, by proceeding in this manner. Your speculative position that you originally bought (the 100,000 shares) is still there for you, but by getting the warrant and later locking in some profit, you effectively reduce the price you paid for that already discounted original issue. Now, if the stock never goes up, you haven't lost anything but the opportunity to lock in this profit.

So, my feeling is that those who play that PP game, aren't interested in speculating by buying up $5 shares by exercising tomorrow, when they can't sell the stock till June 7 - that's too risky (almost irrespective of what they know), they didn't sign up for that risk, in fact, as far as the warrants go, they signed up for no risk, but a lot of opportunity. As far as they want to go with risk, was the initial purchase of 100,000 shares for $4.

And, Glorieaux, if you're correct that the share price might dip as a result of market disappointment over the lack of exercise, then all the more reason not to exercise, as they might be able to buy on the open market for under $5.

Finally, as an aside on the lab, if what QQ says (I think it was she) is accurate, that they put up $200,000, and will get that back $5 at a time with discounts on assays, that seems like pretty risky business to me. I can't believe that is not a conflict of interest - it's a disguised loan at best, and just because it's debt and not equity doesn't mean it's not a conflict. My hope is that the description given of the arrangement is inaccurate.