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Biotech / Medical : ACMI - Accumed Inc. -- Ignore unavailable to you. Want to Upgrade?

To: aatkinson who wrote (845)	12/31/1997 6:18:00 PM
From: Sigmund	Respond to of 1894

Assuming a strike price of $3 as you postulated, extending the warrants means nothing unless the price goes at least up to $3. Let's assume the price goes to $3.25. If exercised at that price, the company gets $3 which is probably more than they would get at a secondary of $3.25 which is unrealistic if the stock had recently risen to $3.25. I am not aware of what the strike price is or the terms of the warrants but usually they have some provision that if the price exceeds X for some period of time such as 30 days the warrant holder "must" exercise the warrant or the company can buy them in for peanuts. This forces the warrant holder to cough up the cash during a peak in prices which might not last and which would certainly not last if the company announced a secondary. Thus the warrants are often a good approach to financing.