may be star of the good oil conference, page-31

1) put down $20K to obtain ctpo options at $0.07 = approx 285,715 options OR

2) put down £20K to obtain CTP heads at $0.13 = approx 153,846 shares.

Scenario is a takeover at $1 say, maybe in a couple of month's time ;-):

1) Option holder would require 285,715*$0.16= $45,715 to convert the options to shares, & sells for 285,715x$1 = $285,715 = $220K profit (1100%)-($285,715 less $45,715, less $20K original stake)

2) Shareholder sells 153,846 at $1 = $133,846 profit (669% profit).

3) Option holder doesn't have the cash & has to sell in the market. Market price would/should be ($1-16c) = 84c (there would be little to no risk if a takeover scenario, and so the options should be priced at fair value, maybe a cent or two less to cover hassle factor & dealing costs etc). At 84c, profit = 220K. At 82c say, profit = $214K.

I'm sure if push came to shove you'd find the $45K if this scenario appeared AND you found yourself severely disadvantaged by selling the options in the market.
The reality is the options would be fairly priced anyway, so you would not need to convert them.
I know where I'd rather be (having sold my heads a few weeks ago & loaded up on the options with the same cash).
I seem to recall JH saying something about the options being a little present for the existing shareholders at the time of the offer. He speaks the truth!