Options insights, page-32

Generally in takeovers, the price offered per share is for all ordinary shares (issued) right up to close of offer date. As the ARUO are exercisable at ANYTIME up to and including 29/02/2024, the holder would just have to BPay the exercise amount/strike price (0.34 per option) to Arafura, the Company Secretary MUST (usually within 24 hours) issue new ordinary shares (ARU) to that holder/exerciser, who then can accept the takeover offer. So yes one would exercise at least 6 days before the close of the T/O offer.

Conclusion the options (ARUO) are never worthless in a takeover offer UNLESS the takeover offer price is 0.34 or less per share.

The biggest risk to ARUO holders is dilution over the next 15 months from any financing/debt taken on by ARU that also involves strategic equity which either involves the immediate issuing of new ord shares (ARUs) or the future "option" of converting debt to equity at either current BUT especially at below current share price as this would quite likely depress the current SP (or least limit its upside). That may also be a reason for the ARUOs trading at below SP-0.34 levels (minimum theoretical ARUO price at close 18/11 should have been 0.46-0.34=0.12, not the 0.10). The risk of SP dilution due to new CR/Debt to Equity conversion is before Feb 2024, as my understanding is there is no formula for adjusting ARUO exercise/strike price (0.34) in the event of equity dilution (some ASX companies do have this feature built into their options when issued, usually larger industrials)

Also most takeover offers take into consideration the presence of (usually unlisted) staff options, performance rights, convertible preference/debt securities that must either be converted to ordinary shares OR if unable to convert to ord shares then have a separate payout amount (usually to Key Personnel, eg CEO, CFO, BOD, GMs, etc) that usually assist the bidder in getting the BODs to recommend a T/O to the shareholders.