Wow. A lot of reading to catch up on. A few though
Post# of 153887
(Total Views: 556)
Posted On: 05/01/2020 1:36:40 AM
Wow. A lot of reading to catch up on. A few thoughts.
Glad they did the video because that PR wasn't the best. Hopeful they learn how to write a PR that doesn't necessitate a video.
The video was AWESOME!
Seems there's a lot of confusion about today's SEC filing.
1. Is this dilutive? YES. Debt is being converted to stock. Warrants are being exercised & converted to stock. Preferred shares are being converted to stock. Nearly 50mil shares are being issued. It's listed right in the filing's table.
2. Is this unexpected? NO. All of these debt/warrant/preferred transactions were previously announced. The company didn't enter into any new transactions that resulted in this dilution.
3. How much money will the company get? Not much. Nothing from the debt being converted to shares. This in effect, extinguishes the debts/preferreds. However, to the extent warrants are exercised by investors, cash will come into the company as it's happened many times in the past. We can't really tell how much money because we don't know which warrants will be exercised and what the strike price is for those warrants. In some cases, the filing only provides a range.
4. Is all the stock going to hit the market at one time? NO. Each investor will make their own decision when to convert or exercise and then they'll make another decision whether to hold the stock or sell it.
5. So what does this filing do? It just gets all the paperwork out of the way so that when they exercise, they can sell without waiting for the paperwork to be completed.
Hope this sets the record straight. A lot of wrong posts about this today.
Glad they did the video because that PR wasn't the best. Hopeful they learn how to write a PR that doesn't necessitate a video.
The video was AWESOME!
Seems there's a lot of confusion about today's SEC filing.
1. Is this dilutive? YES. Debt is being converted to stock. Warrants are being exercised & converted to stock. Preferred shares are being converted to stock. Nearly 50mil shares are being issued. It's listed right in the filing's table.
2. Is this unexpected? NO. All of these debt/warrant/preferred transactions were previously announced. The company didn't enter into any new transactions that resulted in this dilution.
3. How much money will the company get? Not much. Nothing from the debt being converted to shares. This in effect, extinguishes the debts/preferreds. However, to the extent warrants are exercised by investors, cash will come into the company as it's happened many times in the past. We can't really tell how much money because we don't know which warrants will be exercised and what the strike price is for those warrants. In some cases, the filing only provides a range.
4. Is all the stock going to hit the market at one time? NO. Each investor will make their own decision when to convert or exercise and then they'll make another decision whether to hold the stock or sell it.
5. So what does this filing do? It just gets all the paperwork out of the way so that when they exercise, they can sell without waiting for the paperwork to be completed.
Hope this sets the record straight. A lot of wrong posts about this today.
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