to pump or not to pump? this is the question

To post or not to post?

It's probably acedemic for holders of oppies intending to convert... but FWIW I thought it valid to post the following in the end because there is still a window for the SP to rise meaningfully in the next week or so.
If it does or not IMO, is likely in the hands of the underwriter.

That the SP is apparently being capped on the back of the latest ANN is not surprisng.
If it is,then whether this can be attributed to'viability' issues or not remains unclear.
I would think it's obvious that a chief concern for Cunninghams is that the SP does not run too quickly.
This idea plays though into two scenarios:
The first is that they either want to cap it thru to options expiry, which looks quite possible.

The second is that they want the SP to run, because this will expidite a flow of exersized options - (and reduces the underwriting risk)
but they do not want s/traders dumping them back into the market for a quick return and raining on the parade.

This second scenario still may leave Cunninghams with a sizeable parcel of stock to trade on the TSX etc, summizing they may have done a deal with GDN/Shumway.
(GDN needs cash now for drilling)

Which then makes for a very compelling argument calling for a pump before expiry of options trading.

In regard to the things pointing in the right direction for a run, there are still some important events yet to be confirmed.

1. Tolling agreement- No specific timetable/deadline
2. TSX listing date - Could come at any time/not guaranteed
3. Drilling results - Should come at any time - scheduled

Of all these I would have thought that the drilling result would be of primary concern to serious investors, as if successful will sure up the reserves base and justify taking a long position.
Further, I would think that this will be tantamount to Nth American traders as well- along with the option to aquire the rest of the claims in the White Canyon district.
This gives WCU a significantly better profile.

According to company updates drilling (building the bridge between Lark Royal deposit and Daneros)was scheduled for Dec, originally Nov from memory.
They have shown us to date that they do deliver, without fanfare, more or less on time. Given that any funding issues would have been mitigated by the options underwriting there is no reason to believe that drilling would not have commenced in Dec. Just because we haven't heard anything yet, might be a good sign based on WCU's track record thus far: "just do it".

For Cunninghams clients I would have thought that stumping up $22mil in the face of some uncertainties would not sit too well and would require some kind of 'insurance'.

Was this insurance on display around 9/10 Dec when the SP sailed up to 32 cents on 5mil volume and a production ann?

It is pretty obvious it can be made to run whenever they want it to run.
The question now may be:
Is it mean't to look like the SP won't run until late in the month, to keep a lid on S/Traders dumping early and killing momentum for exercising options?
It may be a case of necessity taking things right down to the wire.

From CNHM's perspective, do they need certainty about the timing of a TSX listing date, which is beyond their control, and is still subject to acceptance/invitation too.
(ie responsibilty to Soph. clients)

Are they happy to carry the load if things dont look so rosey, as in questioning the viability of the project.
(AS TCF has been arguing - quite reasonably)
If viability is a real issue though, Cunninghams would be more attuned to this risk than anyone.
In which case surely they would be looking to spread the risk.
Then there is the issue of GDN raising cash for drilling.
Is GDN going to be happy letting 20mil plus options slip away into obscurity? Is Shumway going to wear that?
Or is a deal cut for these options to fall to Cunninghams
and if so, how much are they worth to GDN and Shumway?
And if that were satisfied how much will the SP need added on to reflect a margin for Cunninghams clients/Soph's?

It is a legitimate question, the answers for which are not apparent.
A possibility is that the pump comes close to the wire, option holders rush in to ensure they dont miss out, but not soon enough to dump back into the market and cap the pump/dampen the appetite to convert options.
GDN gets timely funding, Cunninghams have a bucketload of options to convert and send off to the TSX, retail investors on the ASX see the SP rise and are happy campers- No need for ugly back room tactics.

I acknowledge that it is a common theme for options being underwritten to expire worthless.
But then again, there is a more complex set of circumstances at play here.

To pump or not to pump.
That is the question and of course when. If I were Richard Sciano (GDN), conceivably I would be advocating a serious pump quite soon.
If I were Richard Cunningham I would be watching my clients' backs re the unknowns like the timing/actualisation of the TSX listing -as a matter of due diligence.

Is project viability an issue? Ask RC.
Is an early pump desireable? ask RS.

For those looking at conversion of options no matter what, then its all pretty academic anyway.

For those still trying to decide exactly how to position themselves, or to what extent, the above may be useful in trying to clarify what is going on with SP.

My guess is there are quite a few holding surplus options waiting for a spike to unload. But I can not help wondering how many of these can still be left as undecided.

If the flow of news continues over the next week then the odds would point to a kick in the SP, brought on by an eleventh hour pump. This would change the landscape for those undecided and sitting on the fence.

For anyone still scratching their heads, which I suspect may be more than just a few, given the tardy SP action, I hope this provides just a little more room to manouvre.

Cheers and here's hoping that Cunninghams clients (assuming they are involved)are sufficiently risk averse that they are giving RC the thumbscrews and that GDN are counting on their 20+ million options, that may always have been mean't to help the fat lady sing.