sophisticated investors, page-12

the under writing almost ensures that there will be a high percentage who convert their options becuase the punters think that they wouldnt underwrite them if they didnt think it was commercial.

effectively they provide a guarantee.
eg share price is at 28c and options are worth .5c do you throw away the 10c 20c or 30c you paid for them or convert? if you let them go you may just see the share price rebound up to $1 after you let go.

so what do you do?

you convert (or a large percentage will). you have just handed the company the life line and they can spin a great story about depletion of gas and how they have learnt heaps for the second well and the uranium spin off is coming up etc etc.

good luck