LOL! And with over 1.275 million shares short, I don't care WHO is short, they will try to cover on the open market, once there's evidence of revenue (shipping under POs, or licensing royalties).
I agree with Paul that Castle Creek would have had to file 'changes in beneficial ownership' with the SEC even if they just 'shorted against the box.' But for the sake of argument, assume they somehow DID hedge their position, as Larry and Zeev have posited. Would they rather cover with the shares they already own, or would they cover as much as possible below where they shorted? If they WERE hedged (I don't think they were, to the extent posited by some), and if you assume them to be clever and nimble, once they got the sense that POs were likely, they would maximize their return by covering in the open market and retaining ALL the shares they have access to through their preferreds and warrants.
Unless they had access to 'inside information' from the company, which would restrict them from covering on the open market IF they were short. But if they're as clever and careful as some would have us believe, they would have been careful to request the company to NOT tell them such news, to leave them free to act openly, in response to the marketplace.
Or, maybe they're not short. Maybe they're long, and maybe they waived the conditions on the first tranche back in December because they saw the progress the company had made since summer, and wanted to 'stay in the game.' (That was Lev's described scenario to us at the SM.)
My bets are that Lev really did bring the factory online and into production, just like he said he would, and once that's evident, the price will move. Once the price begins its upward move, that will trigger huge short covering. The single digits will evaporate in a flash. And no one who's done their DD and knows the potential is even going to sell in the 'teens, once it becomes apparent that Lev and company have succeeded. We'll have to pull out our chart on price bets for the end of the year, that we made in early January.
The next month will tell. All signs are that the game's afoot. Good luck to all. |
