Capella Resoures (KPS.v): Sauve qu’il peut
On Friday, Capella Resouces issued a PR (6) that said (main extract):
CAPELLA RESOURCES LTD. announces that the Company has received a total of $559,089.15 for exercise of warrants issued under the private placement of 12,933,330 units that closed on March 20, 2009 (the “Offering”). All Shares issued on the exercise of warrants issued under the Offering have a hold period expiring July 21, 2009.
As a small reminder, KPS.v is the company I featured on the blog as the worst scam I’d seen for a long, long time (7)(8) and at that point was in the process of carving up a new prospect for themselves and had excluded previous shareholders from sharing the booty by nefarious means. So what the above PR means is that the insiders that carved up the sweetheart placement in March (each of those units was a share at 6c and a full warrant at 15c and only friends and family were invited) have made about 30% of their 15c warrants whole and will be able to sell them on the open market as from Tuesday 21st July along with the other near 13m shares that come out of escrow (these share escrow period endings are important to keep in mind, as noted last week). As the stock is now at C$0.55 and the company has already said that, through lack of funds, it will not be drilling at its prospective Lajitas property in 2009, expect a large rush for a small exit as from Tuesday as the self-serving scumbag insiders try to get 18 million or so shares turned into cash.
I wouldn’t be at all surprised if the company issues a piece of seemingly good news this week that allows its insiders to sell into volume. Time will tell, but avoid like the plague whatever happens. Again, another ‘caveat emptor’ instance about the crooked ways of the Canadian market and yet again you hear my insistence on the importance of quality managerial teams.