Why would people sell the shares at that much of a discount,...

Why would people sell the shares at that much of a discount, wiping out their .007 cent gain?

Because when shares go ex div the price drops by the gross amount of the div, subject to other mkt influences on the day.

Not only that, you won't pay 100% tax.

Did not say that. Tax is at marginal rates.

So you could also say that if you bought options for 0.012, exercise at .025 equals .037 less, say .0035 (to cover max tax on dividend), and you've paid .0335 per share.

No. You've paid 3.7c per share, you've received a 0.7c unfranked div and your shares are theoretically worth 3.3c.

They have so much money in the bank and are undervalued at their current price.

$23m of their $27m cash will be paid out as a dividend in one week's time.

They are not going to drop by the full dividend amount.

If not, that would be fantastic and potentially due to other mkt forces on the day. I would be very happy as I have applied to convert my options.

People aren't going to get a dividend and then throw it away.

Your words, not mine.

We also have resource upgrades coming mid year and we are still bringing in money because we are producing gold.

Yes, I did say: "But over time if your shares trade back up to 4.0c you will have your 0.3c gain plus would have received a 0.7c unfranked dividend."

Not to mention, people exercising their options are adding to our bank balance.


Yes. The BOD obviously planned on that, otherwise they wouldn't have enough cash to pay the dividend. In reality, optionholders were forced by the BOD to exercise their options due to the amount of the special dividend of 0.5c/share. With the shares at a theoretical ex div price of 3.3c the options could drop to 0.8c, but the Black Scholes valn might hold the price up to 1.2c or above.