I'm taking a "wait and see" position on whether or not S&L is selling shares to allow them to exercise warrants without exceeding 9.99% ownership.  What the excerpt infers is that in order for them to convert warrants, the "Reporting Person" must sell shares prior to the warrant conversion so that they do not exceed the 9.99% ceiling.  This is basically how the scenario that Ease discussed in an earlier post would play out.  I don't know how S&L can sell shares without reporting the transaction, but I know that it's been discussed on this board in the past(so maybe someone else will contribute their knowledge on the subject).

The next 10Q will clear things up.  While it will not surprise me if some warrants have been exercised, I will really be surprised if it's on the order of 50% of their warrant holdings in light of warrant expiration dates extending to 2012.

Be "patient" ... we'll know in time.