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Microcap & Penny Stocks : Zulu-tek, Inc. (ZULU) -- Ignore unavailable to you. Want to Upgrade?

To: PartyTime who wrote (14112)	9/16/1998 12:12:00 PM
From: Jon Tara	Read Replies (2) \| Respond to of 18444

PT, a company doesn't normally just "issue warrants". They are usually given-out as a "sweetener" as part of a secondary stock offering. The buyers are given "units" consisting of a share of common and some quantity of warrants. (Could be more or less than 1 warrant.) The warrants act like a long-term option, and give the holder the right to buy a share of common at a certain strike price at any time prior to expiration of the warrant, usually several years in the future. The strike price is, of course, significantly higher than the current price of the stock. In any case, I don't see any reason why the company couldn't do a secondary offering after everything is completed (or, for that matter, before). One has to consider, though, how well a secondary offering would be received by investors, and the dulutive effect of the additional shares and any warrants on the stock price.