Would you participate in a rights offering to shareholder?

[otherottawaguy]

What would you take in a rights offereing?

[mnholdem]

OOG. A shareholder cannot possibly know how many shares s/he qualifies for until they get the prospectus, so your poll is moot.

Here is an example of a rights offering I once participated in with a startup mining company in Minnesota:

polymetmining.com/news/news-releases/polymet-announces-terms-of-us60-5-million-rights-offering-and-files-final-prospectus/

Until you know the terms, you cannot know how many shares you have a right to purchase at a discount.

[MnkdWASmyRtrmntPlan]

Jun 26, 2017 12:18:32 GMT -5 mnholdem said:

OOG. A shareholder cannot possibly know how many shares s/he qualifies for until they get the prospectus, so your poll is moot.

Here is an example of a rights offering I once participated in with a startup mining company in Minnesota:

polymetmining.com/news/news-releases/polymet-announces-terms-of-us60-5-million-rights-offering-and-files-final-prospectus/

Until you know the terms, you cannot know how many shares you have a right to purchase at a discount.

As I read the following excerpt, it sounds like you could purchase up to 50% of your number of shares.  I know, that that's just an example, but it's a good reference point.  Thanks for posting that, MN.


How many common shares will I be able to subscribe for?

For each common share you hold on the Record Date you will receive one Right. For every two Rights, you will be able to subscribe for one new common share (subject to applicable law).

[babaoriley]

Jun 26, 2017 12:18:32 GMT -5 mnholdem said:

OOG. A shareholder cannot possibly know how many shares s/he qualifies for until they get the prospectus, so your poll is moot.

Here is an example of a rights offering I once participated in with a startup mining company in Minnesota:

polymetmining.com/news/news-releases/polymet-announces-terms-of-us60-5-million-rights-offering-and-files-final-prospectus/

Until you know the terms, you cannot know how many shares you have a right to purchase at a discount.

Gosh, mn, when you said, "Here is an example of a rights offering I once participated in with a startup mining company in Minnesota..."  I immediately thought 3M! 

[casualinvestor]

Is a 35% discount normal? Because I'd buy every share I could. Even if I had to borrow money and would just sell the shares for a quick profit

[sportsrancho]

I'd sell my rights and buy more shares on the open market.

[mytakeonit]

Offerings like this is dependent on how many shares you own. The company figures out what monies they need and then the number of shares that will be made available. Then the offerings will be made depending on where you sit on the totem pole. If you own 1 share ... then you won't be offered a million shares at discount. Maybe, if no one else wants to buy any.

Heck ... a 35% discount would put the price around a buck. You could have got more shares and cheaper just a couple months ago.

Doubt that you will see this offering though ... that's mytakeonit

[otherottawaguy]

Trying to summarize the above poll at 1600h. It looks as if 8 out of 39 would not participate. Those participating would take 400k straight shares and another 400k at the discount. From our little polling group the company could expect to raise sbout 700k.

Will be interested to see what numbers look atend of week.

Who ever suggested creating a poll feel free to take credit, I created it quickly based upon your suggestion in another thread.

OOG

[babaoriley]

Jun 26, 2017 15:18:23 GMT -5 sportsrancho said:

If sell my rights and buy more shares on the open market.

Typical female wheeler-dealer!

[mytakeonit]

Actually sports is right on the money. If some idiot bought the rights ... and the deal fell thru because they can't sell enough shares ... then, she's a winner!

But, this is imaginary ... It'll never happen.

BTW, if you want to buy one of the Hawaiian Islands ... I have a deal for you!

[mytakeonit]

Jun 26, 2017 16:22:25 GMT -5 otherottawaguy said:

Trying to summarize the above poll at 1600h. It looks as if 8 out of 39 would not participate. Those participating would take 400k straight shares and another 400k at the discount. From our little polling group the company could expect to raise sbout 700k.

Will be interested to see what numbers look atend of week.

Who ever suggested creating a poll feel free to take credit, I created it quickly based upon your suggestion in another thread.

OOG

Wait ... this definitely sounds like a Canadian poll.  I think the one who suggested the poll was someone nicknames OOG ... not sure.  Poll ended with 61 votes ... only 1 smart person who would buy all he/she could.

Oops!  Hey, are most of the moderators Canadian?

Okay then ... never mind!

BTW, I love Canada.  If I didn't live in Hawaii ... I would buy a place there to retire.     Wait, I retired when I was 45 years old!  That was like 50 years ago ... before I got dementia?  Sorry, I can't remember.

[straightly]

Jun 26, 2017 16:22:25 GMT -5 otherottawaguy said:

Trying to summarize the above poll at 1600h. It looks as if 8 out of 39 would not participate. Those participating would take 400k straight shares and another 400k at the discount. From our little polling group the company could expect to raise sbout 700k.

Will be interested to see what numbers look atend of week.

Who ever suggested creating a poll feel free to take credit, I created it quickly based upon your suggestion in another thread.

OOG

I did make the suggetion but thanks for the poll.  

Sports' idea is good, but if I were to buy the rights offered to her, I may demand a discount comparing to current market price.

I do have another two questions for these enlightened:

1. What happened to these people who loaned out their shares?  

2. What happens the naked shorts? And the fellow who bought the naked shorts?

I know I am imagine things.  But EVERY scenario I come up will REALLY mess these guys up and put a smile on my face.  

[mytakeonit]

hey straightly ... I know that you suggested the poll ... but, I was putting the strain on the OOG guy. Ha!

The answer to your 2 questions is the same ... they all get killed.

Hope that smile on your face doesn't look like the avatar for OOG.

We all love Canada - A

[sportsrancho]

Jun 27, 2017 12:54:21 GMT -5 straightly said:

Jun 26, 2017 16:22:25 GMT -5 otherottawaguy said:

Trying to summarize the above poll at 1600h. It looks as if 8 out of 39 would not participate. Those participating would take 400k straight shares and another 400k at the discount. From our little polling group the company could expect to raise sbout 700k.

Will be interested to see what numbers look atend of week.

Who ever suggested creating a poll feel free to take credit, I created it quickly based upon your suggestion in another thread.

OOG

I did make the suggetion but thanks for the poll.  

Sports' idea is good, but if I were to buy the rights offered to her, I may demand a discount comparing to current market price.

I do have another two questions for these enlightened:

1. What happened to these people who loaned out their shares?  

2. What happens the naked shorts? And the fellow who bought the naked shorts?

I know I am imagine things.  But EVERY scenario I come up will REALLY mess these guys up and put a smile on my face.  

www.investopedia.com/articles/stocks/05/062905.asp

BTW I do not believe this will take place at all.

[matt]

Jun 27, 2017 12:54:21 GMT -5 straightly said:

1. What happened to these people who loaned out their shares?  

2. What happens the naked shorts? And the fellow who bought the naked shorts?

1.  A shareholder retains all attributes of ownership during the loan period.  The borrower has to return to the entity making the loan exactly what was loaned out thus they are responsible for returning any dividends paid, split shares, or rights that accrue during the loan period unless the agreement says otherwise.

2. A naked short has to sell the shares to a broker, and that broker will expect the same as with a bona fide loan.  Ultimately, the person shorting has to deliver exactly what they sold including subsequent dividends, split shares or rights that accrue.

Overall, the rules of the game are pretty fair and there are not nearly so many naked shorts as you might think.  Yes there are fails to deliver on T+3, but most of those are just delayed for some reason and they clear T+4 or T+5 without further action.  Since the broker is ultimately responsible for returning the shares to their client, they will force a buy-in if the delivery is delayed too long.