Charlie received one warrant (right) to purchase a share of common stock for each ten shares she owned in Ludlow Inc. as a "dividend." The exercise price was \(\$ 70\), the price of the stock was \(\$ 54\), and the value of the warrant was \(\$ 7\). Charlie makes no elections. What are the tax consequences to Charlie and Ludlow if:

a. Charlie's warrants expire worthless?

b. Charlie exercised the warrants when the stock price was \(\$ 85\) ?

c. Charlie sold the warrants for \(\$ 12\) a share?