PAA, A New Dawn , FDA ODD Approval and Entering Phase II MND Trial, page-789

hmmmmm....are you ready for long post and some rambling

Options (first round) were 1c for 1 option per every 4 PAA shares held, these expired and are a 100% loss for most. Use this loss against any capital gains you may have elsewhere...granted it won't be a huge loss unless you had millions of them. Even a million would give a capital loss of $10K
Options (round 2) were .5c and replaced those which expired.

So, lets say someone has 200,000 oppies in the new set. $1000 worth.

They are currently valued at 0.105 each - $21000. Nice leverage (21 times, less brokerage) if you sell them...small risk ($1000). and if you hold them for more than 12 months before selling, you get the CGT discount.

Locks in the strike price until option expiry in 2026 meaning you can get your underlying PAA shares for an additional 15c each even if the trade SP reaches 50c as it did earlier in the year....imagine SP = 50c and a person exercises their options. They now have 50c shares for 15.5c. So then it becomes a matter of what is a better $ return (unless you are more interested in % return, %return is generally always higher in trading the option)

at 50c, the options should be valued around 35c (50c less strike price). even if we said they were valued at 30c you would hold $60,000 worth of options on the example above of 200,000 options
exercising 200,000 options costs 15c more p/share.....$30,000 (total $31,000) and delivers an immediate value of $100,000 in PAA shares (69K differential) but you now hold full ordinary shares and the upside has no limit......assuming everything is going well. You do though, need to cough up the extra 30K. Another upside is that the company gets the money in their coffers...if that's where you want the additional money to go. slight downside with dilution as additional shares are added to the pile. but even if not exercised, they still form part of the equity so perhaps dilution it's really a thing.

Of course it can all go to hell as well. but options give you a cheap entry generally (less risk) with the ability to exercise at the strike price and no limit on upside.

And none of us know exactly how options will be treated should the company be taken over. They are part of the equity of the company so they MUST be included in any take over offering one would think...I am no expert but let's say the company is taken over at $1, on the pure maths, one would imagine any option held should be worth 85c (as long as the options haven't expired). If a takeover came at 14c.....options are worthless.

Someone correct me if I am wrong.