more options pressure , page-18

Spozzie said: "Holders with oppies who do not have the cash have only one option and that is to sell putting weight on the stock."

Of course that only true if the holder holds ONLY MHMO.

There are in reality several alternatives- one being to sell ANOTHER stock from the portfolio to fund the option conversion. It becomes a value judgement about which shareholding has the better future prospects- MHM or the other stock. A holder who is pessemistic on MHM would probably want to sell anyway (that they can find NO other stock in their portfolio with lesser prospects than MHM).

To say that oppies are 'friendless' is not really true. If I wanted to buy MHM at say 50c now, I would prefer to buy oppies now at 30c and pay the other 20c (brokerage free!) in a couple of months- that is an instalments purchase. The fact that buyers a thin AT THIS MOMENT doesn't mean that an oppies seller cannot sell- it just means patience is required.

I think we can be safe in saying the vast majority of MHMO will be converted by SOMEONE (i.e. the person who holds them at the time). The idea that MHM heads will drop below 25c in grossly unlikely. And if 1 million options expire unexercised,I don't care - we would be twice better off if a placement of 1 million new shares was subsequently made at 40c to replace the options. Think about it!!