Heliostar Metals (HSTR.V) has announced a warrant exercise incentive program to convince some of the owners of the 46.4 million warrants at C$0.30 to exercise those warrants. In return, those warrant holders will receive an additional one third of a warrant with an exercise price of C$0.40 for a period of two years. Warrant holders have until December 8th (12PM PST) to participate in this warrant exercise program.
Should all warrants be exercised, Heliostar would receive approximately C$14M in total proceeds and would have to issue approximately 15.5M new warrants with an exercise price of C$0.40 (which could subsequently bring in an additional C$6.2M in cash.
Of course it would be a utopia to expect all warrants to be exercised. But even if only a third would be exercised, the C$4.6M cash inflow would be very welcome to ensure the company can continue to advance the Ana Paula project at the current pace. And it avoids the market wondering ‘when is the next financing?’ when the resource update will be published later this year. Subsequently to this update and before publication, Heliostar Metals announced it indeed has already received commitments from the owners of 15.4M warrants they would exercise their warrants, resulting in an effective cash inflow of just over C$4.6M. As the warrant exercise program remains active for a few more weeks, we hope a few more warrant holders will follow suit.
Disclosure: The author has a long position in Heliostar Metals. Heliostar is a sponsor of the website. Please read the disclaimer.
