Cash warrants against short interest

[Relker]

The present market cap is very low. Partially, the short interest is to blame. Because of this short interest the virtual sharecount increases.  The company considers a 50% stock dividend. However, this might have an adverse inpact on the shareprice. Another way to fight short interest might be issueing cash warrants as dividend. Incase the certification leads to a total payment in excess of 4 B Usd, a bonus dividend is justified which can be paid out to the holders of the cash warrants. If you give a quarerly cash warrant upto 2015, you will force parties to call back shares.

[jft310]

Not much down side in a stock dividend. The main reason is to avoid adverse tax consequences the largest lenders of shares

would call back their loaned shares. Second when the dividend was issued the shorts must buy shares to deliver to the longs.

So their would be an increased float , fewer shares to borrow and forced buying of shares. I call that bullish

[Relker]

Not much down side in a stock dividend. The main reason is to avoid adverse tax consequences the largest lenders of shares

would call back their loaned shares. Second when the dividend was issued the shorts must buy shares to deliver to the longs.

So their would be an increased float , fewer shares to borrow and forced buying of shares. I call that bullish

You can twist it the way you like it but a 50% stock dividend gives a 33% dilution. In my proposal this problem will not occur.

[Movieguy]

Relker, you don't seem to understand that a stock dividend or split is not a problem in any way. Simply increasing the amount of shares does not cause a problem or even really change things. (Whether is it technically "dilution" I am not sure, as I can't say I know the exact stock market definition of the term.) I believe "dilution" is basically when a current shareholder will own less of the company after the action takes place, which is not the case with a stock split or dividend. If there are 100 shares of a company and you own 20 then you own 20% of the company. If the company gives a 50% stock dividend then you would get 10 more shares, and there would be a total of 150 shares. Your 30 (20 + 10) shares would still be 20% of the company. Real dilution would be say if the company issued 10 more shares and gave them to executives. Now you only own 18.75% (30/160) of the company. Hope this eases your concerns.

[Relker]

For shareholders it makes no difference. However, people with large put positions will benefit.

[GeraldR]

No, Relker.  The put options are automatically adjusted.

[Relker]

[quote='GeraldR' pid='35162' dateline='1388116417']

No, Relker.  The put options are automatically adjusted.

[/quoten.

That depends on the situation. However, I think it is smarter to do a quarterly cash warrant which entitles to a bonus dividend after certification.

[jft310]

[quote='GeraldR' pid='35162' dateline='1388116417']

No, Relker.  The put options are automatically adjusted.

[/quoten.

That depends on the situation. However, I think it is smarter to do a quarterly cash warrant which entitles to a bonus dividend after certification.

Relker interesting idea tell mgt. The facts are we need to increase the float which reduces volatility and manipulation. Maybe we

do both?

[Relker]

[quote='GeraldR' pid='35162' dateline='1388116417']

No, Relker.  The put options are automatically adjusted.

[/quoten.

That depends on the situation. However, I think it is smarter to do a quarterly cash warrant which entitles to bonus dividend after certification.

By issueing  a quarterly dividend you make it unattractive to loan out shares.

Relker interesting idea tell mgt. The facts are we need to increase the float which reduces volatility and manipulation. Maybe we

do both?

[jft310]

What would be effect of 25 million shares non dilutive shares trading in IOC? Thats what a 50 percent stock dividend

does!Would that

increase the float and reduce the

manipulation?  Would the stock lenders for tax purposes pull back 11,000,000 shares lent out causing a short squeeze?Of

course.  No wonder Bonk doesn't like the idea.