Ted,
I believe you are mistaken. Below is the verbage on how BNGOW were converted last year. I will place my comments below it.
"On November 14, 1997, the Company delivered a Notice of Redemption of the Company's outstanding Redeemable Common Stock Purchase Warrants ("Warrants") to all Warrantholders ("Warrant Redemption"). The Warrant Redemption set December 22, 1997 as the redemption date ("Redemption Date"). All Warrantholders could elect to exercise their Warrants prior to the close of business on the Redemption Date. On December 22, 1997, the Company redeemed its outstanding Warrants at a price of $.001 per warrant pursuant to the Warrant Agreement between the Company and American Stock Transfer & Trust Co., the Company's transfer agent. Such agreement provides for redemption should the price of the Common Stock exceed $8.00 per share for twenty consecutive trading days. The Warrants are exercisable at $5.00 per share. Subsequent to the Redemption Date, Warrantholders will no longer be able to exercise the Warrants. If all the outstanding Warrants were exercised, the Company would have received proceeds of approximately $16,500,000. As of December 22, 1997, the Company, based on information provided from its transfer agent, expects to receive approximately $12,000,000 in proceeds from Warrant exercises."
As you can see, their price had to be above a certain price, $8 for 20 consecutive days. IGHS warrants will only have to exceed their prices of $3.60 and $6.00 for five consecutive days before the call can be made. Also, they can't redeem warrants which have not been exercised until the close of the last day of the call. Then they can be redeemed for their call price. In our case it is $.10 and in the BNGOW case it was $0.001.
Also, the 1 year and 2 year limits on the Class A and B warrants, respectively, related to how long the warrants are valid at all. Typically, when companies issue warrants, they expect the price of the stock to rise and set limits on the warrants accordingly. If the stock price doesn't reach the desired price by the limits, they often extend the termination dates.
So, yes, you were missing something. It is amazing how many investors don't understand this stuff. I didn't until I watched BNGOW unfold last year. (I didn't own any warrants myself.)
Still, I agree that we all need to read the prospectus very carefully. That is and ALWAYS will be the correct thing to do.
Stay in the Black! jimS |
