Thought I'd just paste the entire post you're referring to so it's easier reading...
Love ya TM and all you have done for everyone with your honesty and research!!!!
Trained Monkey Member Level Sunday, 01/26/14 08:30:36 AM
Re: None
Post # of 82542
Understanding the J/V with CANX...the GIFT program
This is what the deal states:
https://trading.scottrade.com/quotesresearch/...2fMoreNews
"Under the terms of the JV, CANX will provide GrowLife with immediate funding of $1,300,000 to support an initial GIFT program transaction with additional funding up to $40,000,000 to be provided under the terms of the JV. CANX has also agreed to provide $1,000,000 in immediate growth capital funding to GrowLife under the terms of a convertible note offering. GrowLife will own a non-dilutable 45% share of the joint venture company, Organic Growth International LLC (OGI), and GrowLife may acquire a controlling share of OGI under the terms of the JV.
CANX has incentives under the JV to increase the value of assets and market value of GrowLife by and through ownership of initial common stock warrants with additional warrants awarded over the stages of the JV based upon performance metrics tied to OGI performance and the value of GrowLife's ownership interest in OGI."
CANX paid $1.3M for a 55% stake in a JV, called OGI. If they meet financial benchmarks which increase PHOT's value, they can be issued more.
Takeaways:
1. CANX must perform under the agreement and meet certain performance metrics to get the shares from Growlife. What those metrics are have not been disclosed. That is to say no guarantee CANX ever sees one share past the 1.4M already issued; shares must be earned.
2. While we do not know exactly what CANX's metrics are, we have been given to understand that earning the shares only happens when they take actions that raise the PPS. They must make Growlife more profitable, and if/when they do they are rewarded with shares (max 3.4 million as per agreement) at a price of .033. This is not just an outright sale but a rather reward for their performance, should they perform for Growlife!
3. If/when CANX has earned these shares they are unrestricted. Sell, hedge, hold... up to them. In my experience, many agreements like this 'split the baby' and sell some/keep some. Say under the first metric they meet they are rewarded with 100,000 shares. CANX can do whatever it wants with them - why wouldn't they be able to? No capital investor would lend the $$$ if they received shares with serious strings attached and couldn't use them.
But what is the incentive to dump them immediately? If I receive 100k and am in line to receive 3M more, I want to see the value rise!
Also, it is a complete misconception prevalent on this board that the A/S is needed for the JV. Fact is, PHOT has over 260 million shares authorized they still have not issued, which would be plenty to fund the JV with CANX if the A/S increase fails. Which it won't JMO.
Assuming the 2B raise in the A/s goes through, the JV with CANX has them passing to the investors a max of 3.4 million over the course of the entire relationship. This could/should take years.
The other 1,996,600,000 shares can be sold at market for whatever revenue needs they have. See above for what they are going to do with this!
The JV represents .0017% of the proposed A/S. Frankly, a pittance. And those shares are linked to incoming revenue or they never get to CANX
These investors are hitching the wagon to PHOT. PHOT decides which assets to name as OGI (the JV company). CANX gets 55% of profits in that event, but all the cards in in PHOT's hands.
From Shell3, a breakdown of the percentages and how they play out:
"JV can't decide anything, CANX can't decide to do a deal without PHOT okaying the deal, and any deal doesn't mean PHOT has to give up any shares
PHOT has a great deal for the money, how PHOT handles any deal will decide PHOT future, if PHOT wants to buy a Grow House and the cost is $1,000,000 and wants to keep for themselves they can...period....if PHOT wants to buy same grow house and wants to put in JV they already have a obligated partner, CANX would pay $550,000 and PHOT would pay $450,000 - 55% CANX and 45% PHOT....period.... now as far as shares go, if PHOT doesn't have the money they can sell warrants to CANX for .033 a share and raise their 45%....period.....the only shares out on this deal is 140,000,000 @ .033 and that's $4,920,000 cash money to PHOT plus the $1,300,000 they we're paid for the deal.....period.... back to those 140,000,000 shares as part of the deal, if you had this deal at .033 for 140,000,000 shares would you buy them now or wait til their $5 a share next couple years and have to lay out .033 a share and pocket $4.967 a share
Really think about it, $5,920,000 for 140,000,000 shares is .0423 a share at the time of the deal shares we're .089 and tanking) and that is the deal nothing more unless PHOT want to sell more cheap shares....period....PHOT choice, better deal for PHOT to raise money is a PUBLIC OFFERING ON ANYMORE SHARES to buy anything, PHOT might just buy their 45% with their own company shares at the going rate like say .33 and not warrant any more at .033, PHOT would save 27 shares on the dollar, CANX can't get anymore shares than the deal to start JV which is 140,000,000 shares for $5,920,000....period.....All those other 240,000,000 warrants are future ways that PHOT has to choose, sell off company cheap or sell smart."
Love ya TM and all you have done for everyone with your honesty and research!!!!
Trained Monkey Member Level Sunday, 01/26/14 08:30:36 AM
Re: None
Post # of 82542
Understanding the J/V with CANX...the GIFT program
This is what the deal states:
https://trading.scottrade.com/quotesresearch/...2fMoreNews
"Under the terms of the JV, CANX will provide GrowLife with immediate funding of $1,300,000 to support an initial GIFT program transaction with additional funding up to $40,000,000 to be provided under the terms of the JV. CANX has also agreed to provide $1,000,000 in immediate growth capital funding to GrowLife under the terms of a convertible note offering. GrowLife will own a non-dilutable 45% share of the joint venture company, Organic Growth International LLC (OGI), and GrowLife may acquire a controlling share of OGI under the terms of the JV.
CANX has incentives under the JV to increase the value of assets and market value of GrowLife by and through ownership of initial common stock warrants with additional warrants awarded over the stages of the JV based upon performance metrics tied to OGI performance and the value of GrowLife's ownership interest in OGI."
CANX paid $1.3M for a 55% stake in a JV, called OGI. If they meet financial benchmarks which increase PHOT's value, they can be issued more.
Takeaways:
1. CANX must perform under the agreement and meet certain performance metrics to get the shares from Growlife. What those metrics are have not been disclosed. That is to say no guarantee CANX ever sees one share past the 1.4M already issued; shares must be earned.
2. While we do not know exactly what CANX's metrics are, we have been given to understand that earning the shares only happens when they take actions that raise the PPS. They must make Growlife more profitable, and if/when they do they are rewarded with shares (max 3.4 million as per agreement) at a price of .033. This is not just an outright sale but a rather reward for their performance, should they perform for Growlife!
3. If/when CANX has earned these shares they are unrestricted. Sell, hedge, hold... up to them. In my experience, many agreements like this 'split the baby' and sell some/keep some. Say under the first metric they meet they are rewarded with 100,000 shares. CANX can do whatever it wants with them - why wouldn't they be able to? No capital investor would lend the $$$ if they received shares with serious strings attached and couldn't use them.
But what is the incentive to dump them immediately? If I receive 100k and am in line to receive 3M more, I want to see the value rise!
Also, it is a complete misconception prevalent on this board that the A/S is needed for the JV. Fact is, PHOT has over 260 million shares authorized they still have not issued, which would be plenty to fund the JV with CANX if the A/S increase fails. Which it won't JMO.
Assuming the 2B raise in the A/s goes through, the JV with CANX has them passing to the investors a max of 3.4 million over the course of the entire relationship. This could/should take years.
The other 1,996,600,000 shares can be sold at market for whatever revenue needs they have. See above for what they are going to do with this!
The JV represents .0017% of the proposed A/S. Frankly, a pittance. And those shares are linked to incoming revenue or they never get to CANX
These investors are hitching the wagon to PHOT. PHOT decides which assets to name as OGI (the JV company). CANX gets 55% of profits in that event, but all the cards in in PHOT's hands.
From Shell3, a breakdown of the percentages and how they play out:
"JV can't decide anything, CANX can't decide to do a deal without PHOT okaying the deal, and any deal doesn't mean PHOT has to give up any shares
PHOT has a great deal for the money, how PHOT handles any deal will decide PHOT future, if PHOT wants to buy a Grow House and the cost is $1,000,000 and wants to keep for themselves they can...period....if PHOT wants to buy same grow house and wants to put in JV they already have a obligated partner, CANX would pay $550,000 and PHOT would pay $450,000 - 55% CANX and 45% PHOT....period.... now as far as shares go, if PHOT doesn't have the money they can sell warrants to CANX for .033 a share and raise their 45%....period.....the only shares out on this deal is 140,000,000 @ .033 and that's $4,920,000 cash money to PHOT plus the $1,300,000 they we're paid for the deal.....period.... back to those 140,000,000 shares as part of the deal, if you had this deal at .033 for 140,000,000 shares would you buy them now or wait til their $5 a share next couple years and have to lay out .033 a share and pocket $4.967 a share
Really think about it, $5,920,000 for 140,000,000 shares is .0423 a share at the time of the deal shares we're .089 and tanking) and that is the deal nothing more unless PHOT want to sell more cheap shares....period....PHOT choice, better deal for PHOT to raise money is a PUBLIC OFFERING ON ANYMORE SHARES to buy anything, PHOT might just buy their 45% with their own company shares at the going rate like say .33 and not warrant any more at .033, PHOT would save 27 shares on the dollar, CANX can't get anymore shares than the deal to start JV which is 140,000,000 shares for $5,920,000....period.....All those other 240,000,000 warrants are future ways that PHOT has to choose, sell off company cheap or sell smart."
