Dear Stkydate, Quartermain, et.al.QuartermainGood piece of...

Dear Stkydate, Quartermain, et.al.

Quartermain
Good piece of detective work re. fairfax and bpt shareholders. Interesting stuff. I'll have to ponder that one a bit longer while why slow brain ticks it over. Definately will keep this in the back of my mind for future reference.

Stkydate. re. options
I remember my Economics teacher Daddy Walrus teaching us this one. An exceptional man who had a class of thick people. He took two lessons explaining to no avail with most. Hopefully some of it rubbed off ... here goes...

Options are a method by which capital can be raised for the company.

An option gives the holder the right to buy a new share from from the company BEFORE a specific date at a fixed price. In other words you can buy tommorrow at today's prices. BPT is offering you one free option share for every 10 ordinary shares. Let's say you have 10000 BPT Ordinary shares... you will be issued 1000 options. As an option holder you have usually three choices to make.

1. sell your option before the exercise date. You can trade options freely until exercise date (30 June 2010). You can buy as many as the market allows you to buy and likewise with selling. There are many cowboy traders out there that seem to make a living out of this. Option shares are NOT bottom draw shares ... you will need to follow them regularly.

2. Convert your option. To do this you will have to convert your option share to an "ordinary share". To do this you will pay $2 per option share. You can do this anytime between receiving your option and exercise date (30 June 2010)

3. Do nothing - let your options expire (after 30 June 2010). The options are then non existent and therefore worthless. Silly decision in most cases but sometimes necessary if the company goes sour quickly. Sometimes you just have to throw garbage out. A better strategy would be to sell well before exercise date. But hindsight is a wonderful thing.

Your decision about what to do will be based on your belief in the company. If you believe BPT has a bright future with a share price in 2010 well over say $3.50 then options are a fanastic thing for you to consider. If you believe that the share will fluctuate and you are confident in your ability to predict this then trading options may be considered. If you are NOT confident about the company's future then sell your options and your ordinaries and take your partner out for tea.

I hope I have answered some questions for you. Someone smarter than me might like to add to (or disagree) with my discourse.

regards

Capt. Goodvibes
Love Fluid control officer.

DISCLOSURE:- I don't hold BPT at the moment.