Hi playdo,
Your points are interesting, as is the following statement:
"As I keep saying; good product, good (almost unique) window, good strategy, good customers and getting more - and - methinks - big revenue streams coming. Issue will be - can they make a profit from the streams they generate. They certainly should if they are prudent and keep overheads contained".
However (and as I keep arguing), if that is the case, then why doesn't management and the Board actually chance their arm and issue proper Options (ie: those with higher price hurdles, etc)?
At its meeting in December, MUL approved the issue of 90M Options compriisng:
1)
55M 8.75c Options exercisable through to 12/2008; and
2)
35M 10.5c Options exercisable through to 12/2008.
At that time, both tranches were in the money. Now, 2/3s of the Options are just out of the money.
The point is this - why won't they take a chance?
After all, this would be a sign of good corporate governance and consideration for all shareholders.
Now, consider this.
If the shares do, as some would suggest, get to 30c or to 50c, then the Options would be worth:
1)
$18.5M @30c; and
2)
$36.5M @50c.
Companies practising proper principles of corporate behaviour and governance are now issuing Options with proper price and performance hurdles in place and, in fact, are moving away from issuing Options altogether (ie: favouring performance rights, etc, and ensuring that unjust enrichment of Directors /senior management does not occur).
Remember, the 90M Options were only those issued to the Board.
Why is it then that no-one finds this strange? Just the same, I suspect, as all those Options issued at 1c. They were strange too.
MUL
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