I think that I have seen some of the funniest logic on this board. Morgan doesn't make a penny from the warrants unless the stock exceeds $6.60. So apprantly Morgan must feel that TMG has good prospects, otherwise they would have requested a cash payment for taking the risk off TMG's hands....and who said the profits are getting sucked away. Explain to me how the profits are getting taken?
I respect thinkprecisely's logic. We the shareholders have a lot of risk. The stock could go to $0, who knows?
Morgan, on the other hand, has huge upside from its warrants. If everything works out, as we hope, diluted earnings per share will be significantly diluted by the 15% to Morgan, on top of management's generosity to itself via options that it hasn't earned through good performance. I don't know Morgan's downside, but you can bet it is a lot less than us, else they would have bought or received shares as part of the deal!
The assets here are undervalued, yes, I agree. But I respect the decision to sell here, particularly with the honesty and clarity expressed by thinkprecisely. I am not sure he/she isn't right on this one.