Here's the relevant paragraph about the SMOP warrants (I hope you can understand it more easily than I can). It seems that warrants can be had at about their current value guaranteed by the acquiring company in cash if one wishes, and the warrants are perpetual. One buys all the appreciation potential at about 10% of the price of the stock and you can't lose unless the new company goes out of business.
Do you read it that way? (Yes, I know you should charge $500 and hour for this).
Section 3.3. Reorganization, Merger and Asset Sales. If after the date
hereof any capital reorganization or reclassification of the Common Stock of the
Company, or any consolidation, merger, share exchange or similar transaction
involving the Company, or the sale of all or substantially all of the Company's
assets shall be effected, then, as a condition of such reorganization,
reclassification, consolidation, merger, share exchange, similar transaction or
asset sale, lawful and fair provision shall be made whereby the Warrant
Certificate holders shall thereafter have the right to purchase and receive upon
the basis and upon the terms and conditions specified in the Warrant
Certificates and in lieu of the shares of Common Stock of the Company
immediately theretofore purchasable and receivable upon the exercise of the
Warrants represented thereby, such shares of stock, securities, or assets as may
be issued or payable with respect to or in exchange for a number of outstanding
shares of such Common Stock equal to the number of shares of such stock
immediately theretofore purchasable and receivable upon the exercise of the
Warrants had such reorganization, reclassification, consolidation, merger, share
exchange, similar transaction or asset sale not taken place, and in any such
case appropriate provision shall be made with respect to the rights and
interests of the Warrant Certificate holders to the end that the provisions
hereof (including, without limitation, provisions for adjustments of the Warrant
Price and of the number of shares purchasable upon the exercise of the Warrants)
shall thereafter be applicable, as nearly as may be in relation to any share of
stock, securities, or assets thereafter deliverable upon the exercise hereof.
The Company shall not effect any such consolidation, merger, share exchange,
similar transaction or sale unless prior to the consummation thereof the
successor entity (if other than the Company) resulting from such transaction, or
the entity purchasing such assets, shall assume by written instrument executed
and delivered to the Warrant Agent the obligation to deliver to the Warrant
Certificate holders such shares of stock, securities, or assets as, in
accordance with the foregoing provisions, such holders may be entitled to
purchase. |
