KeyOn Communications Holdings, Inc. (fka KEYO)

[lesnshawn]

Valuing a Shell Stock...

How does KEYO weigh in? 9 out of 11...not too shabby.

There are several considerations to review when valuing a Shell Stock:

MAJOR CONSIDERATIONS

- Verified Shell Stock Looking For An Acquisition: it should be actively looking for a reverse merger. Verification can come from SEC reports, news releases, or verbally from company management.
- Experienced Management: management must understand the mechanics of a reverse merger and know a good business opportunity. If management is not experienced, it is imperative they are working with an experienced consultant. (CHECK!)...exactly the way KEYO went public
- SEC Reporting: it must report regularly to the SEC. This is known as a "reporting company." We want to be able to verify information about the company from public/legal filings . . . not by word of mouth or rumor. Believe it or not, there are public companies that are non-reporting. (NHMD was not reporting EXACTLY the same way KEYO is currently non-reporting. One day, that all changed the way it will here)

- Clean: it has little or no debt, no pending law suites, and little or no outstanding convertible securities (preferred stock or warrants). We don't want anything that can complicate the reverse merger. (CHECK!)...remember that 10.3MM shares "traded" out of the blue by an obvious insider on 3/3/14??? Dr.SS just so happened to have 10.3MM shares Preferred Shares LEFT to purchase and CONVERT to common to ACTUALLY obtain his 80% voting right. He doesn't (or didn't) have that before purchasing and converting them. He was only deemed to secure his 80% voting power by his Preferred Stock WARRANTS to purchase those and convert them to common stock. Anybody else care to venture who other than Dr.SS would've purchased those shares and why, and why it's very obvious that they're still holding those shares?
- Small Number Of Outstanding Shares: the smaller the number of outstanding shares, the better. A smaller number of outstanding shares lessens the chance of a Reverse Stock Split. A Reverse Stock Split can lessen the chance of price appreciation. (CHECK!)...Shares Outstanding 25,768,211 a/o Aug 11, 2011
- Low Market Value: basically, this is the buy low sell high rule. A Shell Stock with a low Market Value will have a greater chance of price appreciation than one with a high Market Value. (Market Value = price X shares outstanding). NOTE: the Profile List by Market Value sorts the Shell Companies from low to high Market Value. (CHECK!)...Market Value1 $2,319,139 a/o Nov 20, 2014
- Cash On Hand: some Shell Companies have cash remaining from their previous business endeavors. Having cash to fund the new company's business plan will attract high quality candidates. (CHECK!)...Dr.SS - richest doctor in the world and gets money thrown at him.


MINOR CONSIDERATIONS

- Tax Loss Carry Forward: the new company can offset future net income with the Shell Stock's Tax Loss Carry Forward (but may be limited in amount due to IRS change of control stipulations). (CHECK!)...~$30MM in NOL's only Dr.SS can fully take advantage of
- Exchange Listed: it is better for the Shell Stock to be listed on a stock exchange (NYSE, AMSE, NASDAQ, OTCBB). But, there are some quality Shell Companies that are trading on the Pink Sheets. (CHECK!)


INDICATORS OF A POSIBLE REVERSE MERGER

- Increased Volume/Price: increased volume and price with no news may be an indicator of a potential reverse merger. Information on a reverse merger sometimes leaks out and insiders/family/friends start buying before the reverse merger is announced. (CHECK!)...on 3/3/14 this stock suddenly and unexpectedly increased massively its volume and price.
- Corporate Activity: cleaning up debts, law suits, and issuing reverse splits can indicate management is getting the shell company ready for a reverse merger. (CHECK!)...most done in 2012

lns