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Gold/Mining/Energy : Silver Bull Resources, Inc. -- Ignore unavailable to you. Want to Upgrade?

To: AuBug who wrote (475)	2/5/2007 2:42:56 PM
From: Mr. Aloha	Read Replies (3) \| Respond to of 5637

The "A" on those documents means those directors are acquiring shares, not "cashing in." As the footnote says, these are just options for 9,000 shares each exercisable at $3.50 each granted to these 2 directors as part of the company's stock option plan: "Shares granted pursuant to the Company's 2006 Stock Option Plan on January 31, 2007." If you look at the SEC filings, none of the insiders have sold any shares, unlike many other companies. The increase in authorized shares doesn't meant they have huge plans for dilution. It just means they hit that 50 million share ceiling and needed to bump it up to do things like grant directors options. Per their 10K, they have more than enough cash to complete their feasibility study, so won't need to do any dilution until they finance the move to production, which likely will require significant dilution unless they get bought out or partner with someone. The dilution for production financing already is more than factored into the stock price -- otherwise the stock would be several times the current price. The stock was at .80 in late 2005, so it wasn't any discount to market at all during the earlier part of the fundraising. That "sweetheart deal" was mostly taken by public investors, not insiders. For months, they couldn't get anyone to invest in the placement because there was little interest in the sector with zinc around .60 (Zinc producer HBM was trading at around $3), and it was a thinly traded bulletin board stock whose price had just been pressured down by its biggest shareholder, Britannia, dumping shares to try to get a better deal on the placement. They had to raise money to complete the feasibility study, but they were stuck because of the low stock price caused by Britannia's selling and institutions' lack of interest because of their bulletin board status. Things changed in December and January when zinc took off over $1 and Jason Hommel recommended the stock, showing with profit projections how "MMGG is a stock that could rise nearly 100 times in price" (MMGG: Here's why you will make a fortune on zinc silverstockreport.com ), and the stock shot up to $2 (HBM shot up to $8). The placement became way oversubscribed and they had to reject many interested investors. Fortunately, they were able to bring in new investors and reject Britannia. Though they closed the placement to investors at the beginning of February, it took them a few weeks to decide who to reject and notify all of them, so they didn't announce the closing until March 6. The shares from that placement started freeing up several months ago. There was a big surge in late January/early February, so a large number are freeing up around now, as has been discussed on this board. The stock is now listed on the Amex and is becoming recognized as having perhaps the premier preproduction zinc deposit in the world, and is the only zinc junior listed in the U.S. They have also announced stellar silver drilling results, adding to thousands of results indicating a huge amount of high-grade silver on their property which has 45+ former-producing mines. With so few large zinc projects in the pipeline for coming years, especially in a secure part of the world, MMG will become more and more recognized as a premier mining stock. With several newsletter writers having participated in the private placement, there will likely be some good writeups and promotion coming after their shares are free trading. Institutions, who had very little ownership prior to the listing in November, are taking a stake in the company after management's road show with them the past few months. Some zinc juniors with far inferior potential (e.g., Yukon Zinc) have 80-90% institutional ownership, so there's a lot of pent-up buying waiting for any PP shares that are sold. I've seen blocks of up to 100,000 shares get bought up pretty quickly as shares change hands from PP investors to institutions. There's now much more interest in the sector as institutions recognize the zinc crisis and the value of late stage, low cost, world class sized zinc projects. HBM is now trading around $21 as the profitability of zinc producers has shot up dramatically. There may be continued short-term volatility this month as more PP shares come free trading and people get nervous about the price of zinc, but IMO, longer term MMG will benefit greatly by being held by stronger hands and will move much higher as they advance toward production.