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Easy. Because there is still a tading market for the EAC shares that are left. It's all a game where the smart take advantage of the naive. Look at DWAC. The SPAC for Truth Social. It was a $10 stock like every other SPAC. They set the IPO price at $10 for every SPAC.
So, when Trump was announced as the target company for DWAC, the price rocketed because folks were betting it was going to be huge and they could get in on the ground floor. I think it got as high as $80. Today, it's all the way back down to $12.50. The merger keeps getting delayed, the 2 year deadline extended, and there is serious concern it will close. It was the SPAC version of a pump n dump. And traders are making and losing money both ways. If the deal dies, whoever owns DWAC stock will get about $10/share back. That will suck for anyone who held from a higher price.
Remember the game musical chairs? These SPAC deals are the same. You don't want to be left without a chair when the music stops. Trust me, whoever owns EAC stock today at $10 is hoping and praying some naive schmuck will buy their shares. The investment banks all got out because they know this crap is dropping below a dollar if UNQL closes. They let $260m sit in trust for 2 years, and just said screw it, redeem our shares and give us our $260m back. We didn't profit, but at least we won't lose our ass. That should speak volumes to you.
These boards are crawling with hucksters trying to pawn their bags onto someone who believes nonsense and get rich quick dreams. Notice how the EAC volume has dried up. It's a hot potato and anyone who owns now is just begging for a lifeline. If I owned any EAC, I would just tell my broker to redeem it to at least get my $10 back. The whole stock market is a game, and the newbies and naive get crushed.
Let's try again to put this "anti-dilution" issue to rest once and for all. The Series A, C and D preferred shares have anti-dilution protection. That DOES NOT mean those preferred shareholders can't dilute. It's actually the opposite. They cannot BE diluted. I'll prove it. Here is a Form 3 filed by David Briones:
https://www.otcmarkets.com/filing/html?id=16065397&guid=B2A-kF02DfImB3h
It states he owns 20k Series A preferred shares (he owns 2% of UNQL) . It also says they are convertible at the rate of 1 preferred for 6,547 common shares. Why? Because that is the conversion rate stated in the preferred stock certificate. It's the same for all of the Series A preferred shares. 1 preferred converts to 6,547 common shares.
Here's how anti-dilution protection works. As everyone knows, UNQL outstanding shares increased from 329m upon going public to 799m today. Those extra new shares diluted everyone, including the Series A preferred shareholders. Same with the newly issued Series C and D preferred shares given to Trillium and 3a Capital with that Exchange Agreement. That further diluted the Series A preferred shareholders who were originally issued 130k preferred shares worth 13% of the company. I just showed you Briones has 2%. Front Four has 5%, Lucosky Brookman has 3% and Southridge has (had) 3%. Southridge already converted 1% last year.
However, those 130k shares don't represent 13% of the company anymore with all the new shares. Watch. 130,000 x 6,547 = 851,110,000 shares. That was 13% of 6.5 billion shares when that was the original fully diluted share count. Now, 851m shares is less than 10% of the fully diluted count of 9.6 billion shares. But they are protected by the anti-dilution provision.
To confirm this, first subtract the 9,935 Series A that Southridge already converted awhile ago. That leaves 120,065 Series A preferred shares left, which the company accurately reports. But the company also accurately reports that those 120,065 shares are now convertible into 1,168,177,320 commons. Why? Because of the anti-dilution protection. The conversion rate is no longer 6,547 because that wouldn't yield 12% of the current fully diluted share amount. (It dropped from 13 to 12% because Southridge already converted 1%.) Here comes the math:
9,650,508,886 fully diluted shares x 12% = 1,168,177,320 (it's a smidge off because Southridge didn't convert exactly 1%, but you get the point) shares, just like the company reported on the last quarterly report. THAT is anti-dilution explained correctly!
Bonus round. 3a Capital is entitled to anti-dilution protection for Series C at 12.5%. That calculates to 1,206,313,610 shares. Sure enough, the quarterly report says the same thing. Even when Trillium converted some of their Series D, 3a was still protected to get 12.5%. As for Trillium, they already converted about 1%, so their 12.5% dropped to around 11.5%. That is why the quarterly report has them at a lower 1,130,954,399 convertible shares than 3a Capital. Hope this explains it for the honest folks.
They think the lion has Tourettes, so there's chatter about disqualification, haha. UNQL is the gift that keeps on giving. I have to admit, I did spend too much time here this week trying to help folks with this company and EAC deal. I'm waiting for just one reputable person to honestly explain how EAC will trade at $10 with 35m OS and zero trust money in the bank. Because obviously, if there's anything at all leftover, it will be used to pay Colbeck for part of the Asian Offices $19m loans. It should all be explained by the company in an 8K after the close. Should.
I'm interested if they will change the $282m variable of the conversion formula to whatever is actually left in the trust. There's also a different tweak they could make. With the original 27.6m shares, UNQL insiders were slated to have around the same 27.6m amount of EAC shares after the conversion. That suggests a goal to have the exchange reflect that group maintaining control. At 1.7m shares left, UNQL would still outnumber them with 2.2m shares if indeed $282m is changed to $22m in the formula. But Colbeck would hold the majority with 5.2m shares. I think UNQL will insist on having more than Colbeck, so I suspect that exchange formula will change. But it still won't do much to soften the massive dilution wave forming with those preferred share conversions. Oh well, folks will learn one way or the other. Drinking any fine Irish Whiskey tonight?
I almost completely agree with you. Those preferred shares will convert immediately to UNQL common shares, and THEN immediately get exchanged to EAC shares. I agree with your 0.0029 exchange rate and the amount of EAC shares they will receive. All of those shares will immediately be counted in the new OS for EAC, added to the 7m already in EAC, plus about 1.3m from the conversion of the current 799m OS for UNQL. I also agree those preferred shareholders, who will immediately receive EAC common shares, are subject to that lockup agreement and cannot SELL for 6 months to a year. There are some milestones that can trigger a few earlier transactions at 6 months, but I don't consider that significant. What I do consider significant is the massive 95% dilution those immediate conversions will do to the EAC outstanding shares, and subsequent share price. At a $10m market cap and 35m OS, the price on Nasdaq will only be around 28 cents. Even if the market cap magically becomes $100m, that's only a $2.80 share price.
So, however many shares you or anyone else owns through the merger, do the math. Exchange at 0.0029 and prepare for those share prices. Hope this helps.
I am not saying this to be nasty or rude so don't take it that way. If you are getting your market cap information from the internet financial sites like yahoo and such, even OTC markets sometimes, that is not always accurate. There is no one actively monitoring SPACs on those sites since a typical SPAC is dormant for 2 years while finding a target company.
If I show you the truth about the EAC market cap with an official SEC filing, will you respectfully say you made a mistake on that $280m market cap? Here you go:
https://www.sec.gov/Archives/edgar/data/1832765/000110465923009835/tm234729d1_def14a.htm
That is the proxy statement EAC filed in February to let the public know they had a shareholders meeting on December 21, 2022. That's 3 days after the UNQL merger agreement was signed. Here's the important quote from the filing:
Here's a helpful article from a reputable law firm about SPAC deals with helpful information to explain Colbeck's founders shares and the upcoming dilution:
https://www.mofo.com/resources/insights/210203-spac-101-selected-q-and-a
Notice how the typical SPAC raises around $200m just like EAC. Also notice how target companies are usually much larger than that $200m amount, like $1 billion and higher. These are wealthy institutional investors looking for whales to buy and profit from down the road. How little $10m market cap UNQL got targeted is anyone's guess. I have my own.....
Perfect vehicle to allow the 95% owners to convert their preferred shares all at once. Sure, they can't sell for 6 months to a year, but it's a decent company that shouldn't lose value too much below $10m market cap. It could be a good investment for anyone to consider after the merger closes. I've already said I'll be watching. Good Luck!
Folks see how childish this is. Of course the 40m can't be dumped all in one day. It's been happening for months now. Remember when it was at 2 cents???? Down nearly 50% because it's been sell, sell, sell. No volume because no one with a brain buys this stock with the pending EAC time bomb, unless they are trying to scalp spreads. Obvious to everyone but you sadly.
Gibberish nonsense with no point. No one listens to this stuff. All of the preferred shares will convert. This is a company sale. They will get new EAC shares commensurate with their 95% ownership percentages. Just watch.
There is a very aggressive short player moving up the ask to see if anyone will bite. Fascinating.
He's having a funny twitterverse slapfest with you know who with a new claim about UNQL I've never heard in my entire life. Claims his current average price on UNQL is 0.0069. Which is AMAZING since the lowest price is 0.01. A complete misrepresentation of what "average down" means. Some new made up concept about using profits from sells to "average down" below the lowest ever share price. Where do these people get their information??? If we can all use that new definition for average share price, with all the profit I've made on UNQL over the years trading, my average price would be around 0.0000000001 if I bought 1 share today. LOL. Can't make this stuff up. Talk about alternative facts.....
I'm going to call my accountant and tell him to "average down" the cost basis on all my stock transactions this year so I can lower my tax bill. I'm sure the IRS will love it. Oh wait, that would actually increase my capital gains...uh-oh. Well, maybe this new fangled trick can eliminate the wash sale rule. Sounds magical.....
If anyone is uncertain about how the UNQL to EAC exchange rate for shares is going to work, contact a broker. If you use E-Trade, TD Ameritrade, Schwab, whoever, just call and ask for a consultation. Share this formula from the EAC merger agreement:
March Madness is done for tonight, so here's some helpful information about company valuation. This is the last 10Q:
https://www.otcmarkets.com/filing/html?id=16318747&guid=3PA-kpUTl8d-B3h
The very first chart is the Balance Sheet. At the bottom, there is an important line called Stockholders Equity. That is also known as Book Value. It's a quick reference to get a snapshot of what a company could be worth for purchase, or alternatively, if it goes BK and is liquidated.
The current Book Value as of November 30, 2022 (end of Q2) is only $12,424,882. But that's only a benchmark and a starting place though.
What are the hard assets? Nothing, except for contracts. They have $1.2m in cash (at that snapshot in time in November) and $200k in office equipment. That's all UNQL is. Hard assets of less than $1.5m. To be honest, a $10m market cap is very generous. It would make sense if UNQL consistently made millions in net profits year after year. That would add value to the company to justify a $10m valuation. Or millions of dollars in fancy equipment. But UNQL doesn't make millions in net profits, or have anything fancy. They lost money 2 of 3 years, and the only net profit was a mere $1.7m. That does not justify a $10m valuation. Not in the real world as an investment.
It's a fine business that pays it's employees. That's great. But as a vehicle to consistently deliver profitable returns to shareholders? Not even close. They just mortgaged the next 3 years with $35m in new debt (including interest) when their best year in the past 3 was only $1.7m net profit. This company is like a middle class family living paycheck to paycheck, with rent instead of a mortgage for a house with real equity. A few bad months, a disaster, anything really bad could lead to eminent bankruptcy. They have nothing in the bank, and just went out and financed a Ferrari. Cool car, but with extra insurance, maintenance, low gas mileage, etc. that shiny Ferrari wasn't the wisest choice. UNQL lives paycheck to paycheck and constantly borrows money to fund operations. Is that something really worth $10m to an outside investor? Doesn't everyone have some friends or family members like this? Living above their means while struggling month to month and always asking for money? They promise to pay you back, honest! Are you picking up the phone to "lend" out your hard-earned money?
And Stockholders Equity is just a starting place. Look at that Balance Sheet again to clearly see the items that have "business" value, but no real world, money in your pocket value if things go belly up. Goodwill is $4.5m. It's fine on a balance sheet, but try taking goodwill to the bank to exchange for money to buy groceries....or pay shareholders. Intangible Assets of $7m. Ok, great. Put that intangible money in your intangible pocket and hit the clubs on Friday night. Should be fun! Finally, $10.5m for the right to lease office space. Fine for the balance sheet, but not going to buy any drinks at the club. Add them up. That's $22m of intangible, no real money "assets" on the books with only a $12.5m Stockholders Equity. That means UNQL is actually worth about negative $10m in real world currency. Then, in a liquidation the contracts might be collectible at 50 cents on the dollar. Maybe.
When you look deeper, it is obvious that UNQL is a fine business for the folks who run it and work there. But as an investment? Any investor risks going to zero if the paycheck to paycheck dream dies. The upside so far over 3 years being public is $1.7m in profits. That doesn't come close to covering the $10m Stockholders Deficit once you exclude the intangible fluff on the books. And don't just say any company can fail. Most companies don't operate paycheck to paycheck, and those that do should not be airing that dirty laundry in public.
That's what investors should be looking at. Risk v Reward. The risk is losing everything on a company that barely squeaks by, and now with $35m in brand new debt. The reward is??? A best year of $1.7m and some "new" acquisitions with target earnings before interest and tax deductions of only $5m more? Don't forget about that debt now. $35m over 3 years. UNQL needs to make that much profit just to break even and not default. That's nearly $12m extra every year for the next 3 years....just to give it all away to Colbeck (who is giving $26m to Asian Offices insiders). What's left for shareholders? Where's the value?
In all sincerity, does a $10m valuation with these finances seem a little high? There is no fancy tech. No patents. No intellectual property. Only "customer relations" in an industry where a company like Kroger says hmmmmm, I'm not liking the shipping rates I'm getting with UNQL. Let's go with one of the other 100s of logistics companies in the world. This is not bashing. It is real world analysis based on the facts the company itself provides the public. Think about it. Anyone can do what they want with their money. This Board exists to discuss the company, so there you go.
Haha, according to PB, it's me buying all the cheap shares. You 2 get your stories straight and then get back to us. Your average price might be around 10 cents now with those millions of 20s you bragged about 2 years LOL
It does not seem you understand much about business or company value. The market understands. That $6m is gone. Poof! It just lined the pockets of the owners of the Asian Offices. That $6m is not on the books anymore, so nobody cares.
Now, the books have $19m in New debt that needs to be repaid in 3 years with 15-17% interest. The past performance shows UNQL doesn't earn profit the last 2 quarters. So, when $6m times three is only $18m, that leaves them a mil short PLUS the additional $3m in interest that will be due every year. The market said, nope, not a profitable, growing company with that dead weight around the neck. $26m + $9m in interest down the toilet. The market remembers UNQL had a NET LOSS 2 of the past 3 years. And UNQL is spending $35m on itself????
The Asian Offices are only going to increase revenues by 60% according to what the company disclosed already. They have the same types of costs as the US side, so doubtful there will be much profit from them. Target EBITDA was only $5m, which is before interest and taxes, so the market predicts not much. Hopefully enough to pay the $3m in interest.
Try living in the here and now. Bringing up that vanished $6m is like saying the Bears are a great team because of that 85 team. Ancient History! You've seen the turds that Bears team has thrown out on the field for sooooo long now. Come join reality in the present, and look at the bleak future. $9m extra each year for 3 years to the bank. Not to shareholders. The market doesn't tolerate such mismanagement to line the pockets of insiders. Reality 101
In the real world, the market has evaluated the Asian Offices merger for 2 weeks now, and the price keeps going down. That's reality. The market cap is now below $10m. Facts. The $19m in loans, secured by all the company assets, at an egregious interest rate of 15-17% has been evaluated by the market. The company is below $10m market cap. That is reality. I invest and trade in reality.
UNQL makes NO MONEY! They lost money 2 out of 3 years. The best they did was $1.7m net profit 2 years ago. They just had a $6m profit after the first 2 quarters this year, and now just gave it all away to their old Asian bosses. And they added $19m in new debt. Facts. The real world says less than $10m value for the whole thing....and dropping every day.
For 2 whole years folks have been saying UNQL will go up, up, up. Never happened. It's only gone down, and traded between 1 and 2 pennies. Reality. Why so mad at the real world?
This is the Sponsor Support Agreement, an exhibit included in the EAC merger agreement:
https://www.otcmarkets.com/filing/html?id=16265951&guid=bGA-kFgu3GpnJth#ea170355ex10-3_unique_htm
Colbeck is the sponsor. In SPAC deals, the sponsor typically receives 20% of the SPAC stock in what are called founders shares. With EAC, Colbeck received 6.9m founders shares in the form of Class B Common Shares. Here is an important quote from the Sponsor Agreement:
"4. Forfeiture of Sponsor Shares. Upon and subject to the Closing, and immediately following the automatic conversion of the Buyer Class B Common Stock into Buyer Class A Common Stock, 1,713,139 shares of Buyer Class A Common Stock owned by the Sponsor shall be automatically forfeited to Buyer, without any further action by any Person, and shall be cancelled and retired, and the Sponsor shall not have any rights with respect thereto."
See, these public filings spell out exactly WHAT IS GOING TO HAPPEN so public shareholders can make informed decisions. When the EAC deal closes, Colbeck"s 6.9m founders Class B shares will automatically convert to Class A common shares. Also, that 6.9m will automatically be reduced by 1,713,139 from 6.9m shares to 5,186,861 Class A Common Shares.
This information is all in the filings folks. Be careful with misinformation on social media that tries to distort simple verifiable facts.
When looking at the value of EAC stock after the merger, consider there are going to be around 7m shares outstanding held by existing EAC shareholders. In order for the stock to trade at $10/share, the market cap would need to be $70m. Ask yourself where that extra $60m in value is going to come from. The current market only values UNQL at $10m, and that's after the Asian Offices mergers closed weeks ago. The EAC trust only has $17m left, and we know from other public filings that EAC owes its underwriter on the original IPO $9.5m from the trust. So again, where is the extra $60m in value going to come from to support a $10 price for EAC?
And that question can't be answered even before you add all the new EAC shares that will be issued to acquire UNQL. This is a cash plus stock deal. UNQL and their shareholders will get whatever cash is left in the trust PLUS newly issued EAC common stock. That newly issued common stock is going to dilute the EAC share price for every single new share issued to UNQL shareholders, restricted or unrestricted. The market cap will stay the same, and the share price will go down further. That's how dilution works.
I've shown how the Exchange Rate will be 0.0029 EAC shares for each UNQL share, and predicted around 28m newly issued EAC Class A Common Shares. That is massive dilution. 35m shares would require a $350m market cap for EAC to trade at $10/share. So, moving forward, go ahead and pick any Exchange Rate you want. Whether it's only one new EAC share for all the outstanding UNQL shares (impossible) or it's 28m new EAC shares, or somewhere in between, it is impossible for the EAC share price to trade at $10 with a UNQL company valued at only $10m. That means whatever Exchange Rate you come up with, once you add those new EAC shares for UNQL shareholders to the 7m EAC that will already be in the OS, multiply that new total OS number by 10 to figure out how high the market cap needs to be for EAC/UNQL to sustain a $10 share price.
Just realize that EAC has an authorized share limit of 100m shares. That number is in the amended articles that are also an exhibit to the merger agreement. Read this stuff folks if you're actually investing and not just trading in and out (well, you should read it anyways to be safe and informed.) There are 800m UNQL shares outstanding now, so we know the Exchange Rate has to reduce by at least 90% to 80m to be under the 100m AS limit. But at 87m shares of EAC in the OS, the market cap would need to be $870m for a $10 share price. We know a handful of folks who have come and gone who "swear" UNQL is a billion dollar plus company with a billion in revenues. The $10m market cap today says otherwise, but hey it's the OTC. Maybe NASDAQ will see things differently. (I'm being sarcastic!)
Hope this helps the honest folks.
Congratulations, you finally ADMITTED the EAC merger agreement states all of the UNQL preferred shares will convert. You still don't understand what that means for the new EAC share structure, but it's a big first step. Good job!
This is a perfect example of you providing old, outdated, and wrong information. It is EXACTLY why you are so dangerous. Your quote is from the merger agreement dated December 18, 2022. AFTER THAT DATE, there was February 2, 2023 proxy statement from EAC to clearly explain they had a shareholder meeting on December 21, 2022, also AFTER the UNQL merger was announced. At that shareholder meeting, nearly 26 million EAC shares were redeemed and canceled because the original EAC investors wanted their money back. All of those institutions banks and investment funds wanted no part of UNQL. They all received $260m from the EAC trust. That money is GONE! Here, read:
https://www.sec.gov/Archives/edgar/data/1832765/000110465923009835/tm234729d1_def14a.htm
This is the quote from the Background section of that proxy statement:
"On December 21, 2022, Edify held a special meeting of the stockholders at which the stockholders approved a proposal to amend our Amended and Restated Certificate of Incorporation (the “First Charter Amendment”) to allow Edify to extend the date by which Edify must consummate a business combination from January 20, 2023 (the date that is 24 months from the closing date of Edify’s IPO) to April 20, 2023 (the date that is 27 months from the closing date of Edify’s IPO) (the “Amended Date”) and on a monthly basis up to three times from the Amended Date to July 20, 2023 (the date that is 30 months from the closing date of the IPO) by (i) depositing $225,000 into Edify’s trust account for the three month extension from January 20, 2023 to the Amended Date (the “Initial Extension”) and (ii) depositing $75,000 for each subsequent one-month extension from the Amended Date to July 20, 2023. On January 17, 2023, Edify made a cash contribution of $225,000 to the trust account for the Initial Extension. In addition, the stockholders elected to redeem an aggregate of 25,912,336 shares of Edify’s Class A common stock in connection with the First Charter Amendment. As a result, an aggregate of $259,123,360 (or approximately $10.09 per share) was removed from Edify’s trust account to pay such stockholders and 1,687,664 shares of Edify’s Class A common stock were then issued and outstanding following such redemption. As of January 27, 2023, the record date for the Annual Meeting, there was approximately $17,513,455.16 held in the trust account."
Issued and outstanding means that's what's left in the OS of EAC after December 21, 2022. 1,687,664 shares. Everyone can see that your information is wrong and OUTDATED. Get your facts straight. Since you don't read or keep up on filings, I actually explain this stuff accurately to everyone. Here is my old post #27759 from February 2, 2023, when the proxy was filed when I ACCURATELY explained what happened:
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=171106476
All of your name calling and insults are exposed when everyone sees the truth and EXACTLY how WRONG your information is about UNQL, and now EAC. You tell innocent folks to buy UNQL based on false information. There is a word for that type of conduct, especially in the eyes of the SEC.
I have to respond to this because I honestly can't tell if you're a criminal or the stupidest person on the internet. Maybe it's both.
Yes Einstein, the preferred shares CONVERT into 8.8 billion common shares. Yes, the weighted average is adding the 800m OS to the amount that can be (will be) converted.
Read this 10Q on page F-12:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1281845/000149315223001635/form10-q.htm
The Series A are convertible to 1,168,177,320 commons.
The Series B are convertible to 5,373,342,576 commons.
The Series C are convertible to 1,206,351,359 commons.
The Series D are convertible to 1,130,954,399 commons.
Add them up. That's 8,877,967,424 common shares that can be converted. Add those to the 800m OS and you get the Weighted average common shares outstanding and assumed conversion – diluted amount of 9,677,967,424 common shares. Can you read?
The EAC merger agreement states they shall all convert. I just posted that agreement and the specific pages. Argue with reality all you want. It's actually funny.
Already did it, multiple times. I'm done with your nonsense. What is clear to anyone who reads this board, you NEVER provide backup except for small cut and pastes taken out of context and omitting other important information. A billion in revenues! What about the billion in costs? You never mentioned that important part of the equation.
Here, right from pages 1 and 2 of the merger agreement:
"At the effective time of the Merger:
+ each share of Company Series A Convertible Preferred Stock (other than excluded shares and dissenting shares) will be cancelled and automatically deemed for all purposes to represent the right to receive a number of shares of Buyer Class A Common Stock equal to the product of (i) the number of shares of Company Common Stock into which such share of Company Series A Convertible Preferred Stock is convertible, taking into account the effects of the Transactions in accordance with the certificate of designation applicable to such Company Convertible Preferred Stock, and (ii) the Common Exchange Ratio;
+ each share of Company Series B Convertible Preferred Stock (other than Excluded Shares and Dissenting Shares) will be cancelled and automatically deemed for all purposes to represent the right to receive a number of shares of Buyer Class A Common Stock equal to the product of (i) the number of shares of Company Common Stock into which such share of Company Series B Convertible Preferred Stock is convertible, taking into account the effects of the Transactions in accordance with the certificate of designation applicable to such Company Convertible Preferred Stock, and (ii) the Common Exchange Ratio;
+ each share of Company Series C Convertible Preferred Stock (other than excluded shares and dissenting shares) will be cancelled and automatically deemed for all purposes to represent the right to receive a number of shares of Buyer Class A Common Stock equal to the product of (i) the number of shares of Company Common Stock into which such share of Company Series C Convertible Preferred Stock is convertible, taking into account the effects of the Transactions in accordance with the certificate of designation applicable to such Company Convertible Preferred Stock, and (ii) the Common Exchange Ratio; and
+ each share of Company Series D Convertible Preferred Stock (other than excluded shares and dissenting shares) will be cancelled and automatically deemed for all purposes to represent the right to receive a number of shares of Buyer Class A Common Stock equal to the product of (i) the number of shares of Company Common Stock into which such share of Company Series D Convertible Preferred Stock is convertible, taking into account the effects of the Transactions in accordance with the certificate of designation applicable to such Company Convertible Preferred Stock, and (ii) the Common Exchange Ratio."
Here's the filing:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1832765/000121390022080651/ea170231-8k425_edifyacq.htm
The agreement states clearly in plain English that the preferred shares shall convert. I'm seriously done with the nonsense. Peace!
I will continue to be an adult and speak intelligently. The formula is in black and white. The terms are clearly explained. Right below the formula is the information on the A, B, C, and D preferred shares. Do you even read filings? They will all convert upon merger. That is EXACTLY why the agreement addresses the preferred shares.
You're busted on not calling your broker. Nice dodge. It's not research. It takes a minute to look at the formula in the filings and then the fully diluted share amount in the 10Q. The truth has been explained, but you will learn the hard way. And the claim that a broker won't do the research for you is priceless. THAT'S THEIR JOB!!!
If someone owns 1m shares today, those will become 2,900 shares. Today, at 0.022, those million are worth $12,000. Once converted to EAC, they would be worth $29,000 at $10/share.
And THAT is where the BS is shameful to encourage folks to buy and get them into serious financial trouble. EAC will not trade at $10/share when it opens the day after the merger closes. Just watch. I've explained it all clearly based on the fundamentals.
The $10 price is ONLY based on the money in trust. There are now only 1.7m EAC shares outstanding with $17m in trust. Still $10/share. But, after the deal closes, all of that money will be gone to pay the EAC underwriter and fees for this merger. IT'S ALL IN THE FILINGS AND I'VE QUOTED EXACT PAGES!! These are filed with the SEC.
That means the market cap on NASDAQ will be the same exact value for UNQL it trades at today. Less than $10 million. That is the market cap for UNQL. When it opens on Nasdaq, the price will adjust to reflect that $10m market cap with 35m outstanding EAC shares. I've explained it precisely. That's going to be about 30 cents a share.
Let's say for the sake of argument that all $17m stays, (it won't) and call the new market cap $30m. That's still less than $1/share. Those 2,900 shares will be worth less than $2,900. Not $12,000. In order for those shares to be worth $12k, the market cap will need to be $145 million with 35m shares outstanding. KEEP DREAMING!!!
What you fail to understand is that today, whatever you own is only worth 0.012 based on 800m OS. If the company declared BK or is sold tomorrow, all preferred shares convert. It's in the documents and that's how preferred shares work. THEY OWN 95% of the company in cases of BK, liquidation AND sales of the company. EAC is BUYING the company. This is very basic stuff so 38 years hasn't taught you much. The fully diluted value of your shares today is not 0.012. At 9.5 billion shares and a $10m market cap, the value today (if there was a sale) is only 0.001/share. That means a million shares are not worth $12k, they are worth $1k. THAT'S HOW PREFERRED SHARES WORK!!
And you don't seem to understand that the EAC merger is a SALE of UNQL. It's called EDIFY ACQUISITION CORP. THEY ARE ACQUIRING UNQL. And, in the filed merger agreement, for anyone smart enough to read and make wise investment decisions, the UNQL shares will convert as if immediately upon the day before the closing. It says so directly in the contract.
To believe your story, none of the preferred shares convert upon merger, and those preferred shareholders get zero EAC shares. According to your story, those original UNQL investors will lose ALL of their equity ownership in the company. They get nothing. They didn't convert in time because Ray never raised the AS amount. They are the big losers. Ray, Great Eagle, Lucosky Brookman, Trillium, 3a Capital, Front Four, Southridge, Briones, Hicks, Canouse. They all agreed to a merger deal that will wipe out all of their preferred shares and they will get nothing. That is how stupid it is in the real world when anyone considers your nonsense. The guy on the internet is going to make BANK on UNQL, but the lawyers, corporate executives, investment bankers who already bought UNQL for $10m in 2020 and then loaned another $4m will end up with nothing. As you say ROTFLMAO!!!!
Just watch. I'm done dealing with your nonsense. Anyone who listens to that nonsense deserves what happens.
This little investment firm called Morgan Stanley. We laugh at all the nonsense on this board. Who do you use? Call them. Ask what the exchange rate will be for EAC shares. The formula is in the public filing and is not rocket science. But go ahead and call/email to ask a professional. Anyone here can also.
282,000,000 divided by....
The sum (that means add) of current Outstanding Shares (800,000,000) PLUS the amount of shares all preferred shares would convert to (8,877,967,424).
This equals 9,677,967,424 fully diluted shares. (That exact amount is taken directly from the last UNQL 10Q)......
Ready....282,000,000 ÷ 9,677,967,424 = 0.0291383498. That's the Per Share Consideration Value.
But, the formula is not done yet.....
Then divide by 10. The "quotient of" means to divide. That equals roughly 0.0029. That's the Exchange Rate.
Here's the EXACT quote from the filing:
"At the effective time of the Merger, each share of common stock, par value $0.001 per share, of the Company (“Company Common Stock”) (other than excluded shares and dissenting shares) will be cancelled and automatically deemed for all purposes to represent the right to receive a number of shares of Class A Common Stock, par value $0.0001 per share, of Buyer (“Buyer Class A Common Stock”) equal to the quotient of (i) the Per Share Consideration Value (as defined herein), divided by (ii) $10.00 (subject to equitable adjustment) (the “Common Exchange Ratio”).
The “Per Share Consideration Value” equals the quotient of (i) $282 million, divided by (ii) the sum of (A) the number of shares of Company Common Stock, plus (B) the number of shares of Company Common Stock into which all of the shares of Company convertible preferred stock, par value $0.001 per share, of the Company (collectively, the “Company Convertible Preferred Stock”) would convert, in each case, as of immediately prior to the Merger, taking into account the effects of the Transactions in accordance with the certificate of designations applicable to such Company Convertible Preferred Stock."
Talk in all the circles you want. 38 cents down to a penny. Scoreboard.
Nope, I said they would not raise $40m by selling new shares, and instead they would need to go with debt financing. Exactly what I said happened.
C'mon, tell us the Earth is flat next.
This post claiming to add more shares at this dirt cheap level will not age well. We will revisit if the EAC merger closes. 0.0029 exchange rate from UNQL to EAC. Just ask a broker. I did and I'm sure many others here did also. Pretty simple.
I sincerely cannot wait until the EAC merger closes and you see what happens to your UNQL account. Can't wait!
You do see that large tranches of shares are being sold off every day, yes? Nearly 2 million today.
Some have been wrong about absolutely everything UNQL since 38 cents and those "facts" never come to fruition. No dimes, no dollars, no $100m market cap. Begging other boards to buy the most undervalued ticker on the OTC.
Price just keeps dropping, even after the Asian Offices merge(r). Those are the true facts as explained by yours truly.
Tell us why.
Thank goodness the mindless nonsense about what UNQL isn't finally stopped on this Board. Smart money figured it out and I am hopeful my posts helped. For anyone new, these are some verifiable facts to consider about UNQL.
1. When it went public on reverse merger with Innocap in 2020, the stock equity of the company was around 6.5 billion fully diluted shares (common and preferred) owned by company insiders (Ray and Great Eagle Freight [which is Hong Kong] owned 82%) and initial "investors" like Front Four Management, Lucosky Brookman, Southridge LLC, and David Briones owned 13%. That's 95% ownership, leaving the public with 5%. The public only owned 131m shares when UNQL went public. After a long series of convertible notes, subsequent conversions by 3a Capital and Trillium, and selling those converted common shares to the public, there are now about 475m shares owned by the public. 3a and Trillium made millions of dollars selling those converted shares to the public, and still own 25% equity. The fully diluted shares now owned by insiders after 3a and Trillium were given 25% equity in exchange for $4m is 9 billion shares. The public still only owns 5% of the company currently.
2. According to the publicly disclosed terms of the EAC merger, each of the 9.5 billion shares will convert at a rate of 0.0029 shares of EAC. The current public 475m shares will become 1.37m shares of EAC. The other 9 billion shares owned by insiders will become 26m shares of EAC. The current ownership of EAC is 1.7m shares, plus 5.8m Colbeck shares to be issued upon merger. That will put the OS of EAC at around 35m shares. The public's 1.37m will drop to less than 4% equity ownership. Unfortunately, anyone who holds through the EAC merger will learn a lesson on precisely what fully diluted share amount means. One person can only help so much.
3. Most mergers and acquisitions happen with a combination of cash and stock. Look at the Mint Mobile/T-Mobile deal today. It is unheard of for a healthy, reputable company to go $20m into debt to fund an acquisition. Those companies just issue more stock to institutional investors who believe in the company, in order to raise the money. And the acquired company stockholders look for a brighter future and better return from the bigger acquiring company, so they are happy to accept the new stock. That didn't happen with UNQL. They tried a $40m capital raise, and quit after nearly 2 years because no institutional investors want to invest in UNQL. The Asian Offices owners could have easily been offered a combination of cash and stock for both the original US office spin-off in 2020 ($10m), or the Asian Offices that just closed for $26m. The Asian Offices owners said no to UNQL stock in both instances. They don't want to own stock in their own company that they built since 1983. Those decisions alone, to only take cash instead of any stock, speak volumes about the value of UNQL stock and what is to come with the massive dilution upon the EAC merger. Plus, $260m of money was removed from the EAC trust by those institutional investors on the announcement of the UNQL acquisition because they want no part of this company. It speaks volumes.
4. After the EAC merger, investment firms Colbeck, 3a Capital, and Trillium will collectively own nearly 50% of UNQL in stock. Ray, Hong Kong, and those other insiders will own nearly 50%. And the public will own less than 4%. Colbeck will profit greatly through CB Agent with around 15% interest on a $19m loan over the next 3 years, assuming no extensions. Plus, they have a fully secured interest in all UNQL assets in case of default. That means Colbeck is hedged either way on the success or failure of UNQL over the next few years. If payments are made, great. Interest payments of $3m/year. If UNQL defaults, great, Colbeck takes over the entire company.
5. It will be interesting to see what happens down the road. After the merger, the price will stabilize and if the company stays on Nasdaq, there will be new opportunities to raise capital from institutional investors and issue more shares to eventually get into public trading hands. I will be watching. However, at this point in time, based on all these facts, everyone should be able to clearly see that UNQL was not, and is not, the most undervalued, greatest ticker in the history of the OTC. It had a massive spike to 38 cents 6 months after going public, purely on social media misinformation. It's just a brick and mortar middleman company that creates regular jobs for regular folks, and struggles to turn a profit. 2 years of losses and 1 profitable year at $1.7m. Ray and the Asian Offices owners got $36m earned by the company. The shareholders got nothing. No dividends. Nothing.
That is the true story of UNQL. Good Luck out there folks.
I don't know about CEO. This industry likely requires quite specific knowledge. It will be interesting to see the new makeup of the Board of Directors if/when the EAC merger closes. If there are numerous Colbeck folks on the Board (the amended articles call for 7 board members in general), there will be inherent conflicts again regarding business decisions and Colbeck's ownership of CB Agent, the lender of the $19m. Colbeck stands to profit by a higher interest rate if UNQL defaults any payments, and the secured interest in all UNQL assets is a further conflict of interest. But that didn't stop UNQL from having MB Lee on the Board while he continued to serve as the COO of the former parent company, which was just bought for $26m.
This company has been a soap opera since going public. The very basic fundamentals of the company have remained the same. Very low margins with very little net profit. But the amounts of debt they have taken on just to pay Hong Kong and the US office owners is astounding. Around $10m for the US agreed to in 2020 and still being paid off. Now another $26m for less than 100% of the Asian Offices, to be paid off by 2026. All that money and all that interest, wiped off the books for the common shareholder. If anyone doesn't fully understand yet that this has all been a scheme to enrich insiders, that's on them at this point. It certainly would not have cost Hong Kong $36m to go public with the whole company on the OTC in 2020, followed by a transfer of ownership/control to Ray if that was the goal.
The financing terms are finally out. $19m loan with a first draw of $4.2m. The good news is no convertible notes. The bad news is prime (7.75% currently) plus 9% (with some other options) but basically 16-18% or so. Add another 3% if UNQL defaults any payments.
That's about $3m in interest annually, plus repayment of principal. Hopefully those synergies combine because that's a lot of money to come up with. Especially when the highest net profit is $1.7m the past 3 years (with 2 years of net loss.) Should be interesting.
And, the company made this a secured loan, so basically mortgaged the entire company to repay. This is quite standard though for a loan like this.
The market will react tomorrow....maybe. Good Luck out there.
I believe you have those 4 letters misplaced and out of order, and the first one should be F and the last one K. Hint... it's not UNQL....
It seems the liquidation is going to take some time. Volume drying up. Wonder who is buying the hot potato? It could be a good play if the EAC merger is canceled to allow for the old bounces between 1 and 2 pennies. Who knows since the company is as transparent as a brick wall. Those Asian Offices financials should be filed soon. Wonder if we will need to convert Rupees to Dollars and whatnot?
It's looking like time for bun to jump in and tell the world how UNQL is the best stock on the OTC....well, behind that energy dog that's down another 10+% today. I mean they have to go up eventually after all the losses, right??? Then we're talking genius call. LOL
Remember when UNQL was the BEST STOCK EVER!!!! Going to make history on the OTC.....
Dump City today. That Asian Offices merger lingers like a stale fart now.
6 month revenues are just $225m compared to $595 last year. And the wizards paid $26m to re-absorb its own global offices to add a mere 40% in revenues. So, that would have been a measly $90m more for a grand total of $315m in 6-month revenues. That's still nearly half of last year when it still traded at a penny and had a $10m market cap.
By every conceivable measure, this merger at $26m was a horrible deal, and the public gets it. And say goodbye to $3.5m in cash already. This company is run by self-dealing morons. A $10m company paid $26m for it's own offices that generate 60% less revenues. Can't make this stuff up!
If only there was an independent Board of Directors to oversee such terrible decisions. What a clown show!
Someone bought all 49k shares today for $700? Wow, big spender!
2 years to "merge" with themselves and pay $26m to the insiders. Well played, well played indeed!
2 years ago it was trading at 20-30 cents. Oh how times have changed. Ouch!
Tell us something interesting about UNQL
Do you get bored lurking on boards and making pithy comments with no substance? Were you able to make any real money with all the free advice I've provided? Just curious.
In case anyone new is unfamiliar with Edify Acquisition Company (EAC) and how they impact UNQL, they are a blank check SPAC that started 2 years ago with 27.6m shares sold to institutional investors for $10/share. EAC therefore raised $276m which was held in trust for 2 years while its Board searched for a target company to acquire.
In December 2022, EAC targeted UNQL for a merger and agreed to terms whereby UNQL would convert all of their outstanding and convertible preferred shares into EAC shares on the Nasdaq exchange. The Exchange Ratio in that agreement states every UNQL share will convert to 0.0029 EAC shares when the deal closes. It hasn't closed yet.
A common feature of a SPAC is that the original investors in EAC have the right to redeem their shares before the target deal closes in order to get their money back, plus whatever interest accrued over 2 years. As explained in this public filing from EAC, nearly 95% of those original investors backed out of this UNQL proposed merger and redeemed 26m shares:
https://www.sec.gov/Archives/edgar/data/1832765/000110465923009835/tm234729d1_def14a.htm
Over $260m was removed from that $276m trust and returned to those investors. That money is gone. Here's the quote from the filing:
"On December 21, 2022, Edify held a special meeting of the stockholders at which the stockholders approved a proposal to amend our Amended and Restated Certificate of Incorporation (the “First Charter Amendment”) to allow Edify to extend the date by which Edify must consummate a business combination from January 20, 2023 (the date that is 24 months from the closing date of Edify’s IPO) to April 20, 2023 (the date that is 27 months from the closing date of Edify’s IPO) (the “Amended Date”) and on a monthly basis up to three times from the Amended Date to July 20, 2023 (the date that is 30 months from the closing date of the IPO) by (i) depositing $225,000 into Edify’s trust account for the three month extension from January 20, 2023 to the Amended Date (the “Initial Extension”) and (ii) depositing $75,000 for each subsequent one-month extension from the Amended Date to July 20, 2023. On January 17, 2023, Edify made a cash contribution of $225,000 to the trust account for the Initial Extension. In addition, the stockholders elected to redeem an aggregate of 25,912,336 shares of Edify’s Class A common stock in connection with the First Charter Amendment. As a result, an aggregate of $259,123,360 (or approximately $10.09 per share) was removed from Edify’s trust account to pay such stockholders and 1,687,664 shares of Edify’s Class A common stock were then issued and outstanding following such redemption. As of January 27, 2023, the record date for the Annual Meeting, there was approximately $17,513,455.16 held in the trust account."
So be careful what you read out there on social media folks. There is not $276m in the EAC trust anymore. Only $17.5m left as of 1/27/23. And it still trades at $10/share because there are only 1.7m shares left.
And that $17.5m will dwindle further. As part of the original EAC IPO agreement, EAC owes its underwriter $9.5m in deferred compensation from that trust account if the UNQL deal closes. Plus, UNQL just executed $22.5m in promissory notes to Hong Kong with a provision that $10m of whatever is left in the EAC trust will be used to repay those notes.
But, UNQL already has $35m in new loans in place from a company called Colbeck (which is the EAC sponsor and runs the Board of EAC.) Here are the basic terms of that huge loan from the same public filing:
"Unique Logistics has the right to terminate the Merger Agreement if Edify has not provided the Debt Facility (as defined below) or alternative debt financing by February 5, 2023 (or a later date as determined by Unique Logistics in its sole discretion). “Debt Facility” means the senior secured financing facility in the maximum aggregate principal amount of $35,000,000 to be provided by CB Agent Services LLC (and such other lenders as are party thereto) to Unique Logistics, on such terms and conditions as are set forth in that certain term sheet set forth as Exhibit A to the Commitment Letter, dated as of December 18, 2022, provided by CB Agent Services LLC (and/or such other lenders as are party thereto) to Unique Logistics, consisting of (a) an initial term loan facility in the original principal amount up to $25,000,000, and (b) a $10,000,000 delayed draw term loan facility."
For reasons known only to UNQL, they refuse to publicly disclose that Term Sheet to their investors. This EAC deal is still very murky, and it says A LOT that 95% of accredited institutional investors/banks/hedge funds pulled all of their money out, wanting nothing to do with this.
Those are the facts confirmed by public filings. Ask yourself why some random person on Twitter or whatnot would say UNQL is such a great investment that will make you rich. Because they are smarter than all of those institutional investors who had $260 million dollars to invest???
This lack of public interest and no increase to the market cap after the Asian Offices merger completion does not bode well for Nasdaq. If the share price drops below a dollar for 30 days, once on Nasdaq, they will get a delisting notice.
There are only 1.7m shares of EAC outstanding, plus another 5m of founders shares that will become part of the OS once/if the SPAC deal closes. The value of that EAC empty shell on Nasdaq will be zero, except for whatever market cap UNQL brings to the table. (Read the promissory notes in the 8K. They require UNQL to use whatever is left in the EAC trust up to $10m to make the upcoming payments to HK of $4.5m, $5m, $5m, etc. Not even enough to pay the full $22.5 currently owed. And don't forget about the $9.5m EAC already owes its underwriter if the SPAC closes. There will be ZERO left from that EAC $17m trust as of today for the UNQL balance sheet.) After this Asian Offices merger, that market cap for UNQL is still only around $12m as it trades today.
Next, you need to factor in all of the UNQL shares (both existing OS and to-be-converted preferred shares.) The math on this has been explained before, and the new EAC/UNQL outstanding shares will be around 35m shares, with an AS according to the current Articles of Incorporation of 100m shares. If the market cap remains $12m, with 35m OS, the Nasdaq price will only be about 34 cents/share.
If it all plays out this way, they will either drop right back down to the OTC 6 months after the uplist, or UNQL will need to do a reverse split to get the price over $1/share. Probably a 4 for 1, or 5 for 1 reverse split. 35m OS would then drop to 7m - 9m shares. But 95% of those will be restricted from trading due to the lock-up agreements. That would leave only 350k - 450k shares in the float.
No matter what, UNQL will be very interesting to watch in the next year. IMO, Edify is going to rethink this SPAC merger and might back out. Colbeck (which is owned by Edify) might then just use that $25m - $35m loan to do on the OTC what Trillium did the past 2 years. Convert and dump to the public to make back all that loaned money, and then some. Way easier to do on the OTC. Yes, of course this path would require UNQL to raise the AS on the OTC. They have done it before. Just need to wait and see if they do it again. Fascinating!
Although very disappointing such feeble trading action after closing the Asian Offices. I don't think anyone expected that. I know I didn't. It's like the goose that laid the golden eggs went barren.
That next $4.5m payment to HK is due in 7 days. If the company doesn't disclose the Colbeck loan Term Sheet soon, I think every investor should complain to the company, Ray, IR, MZ, and the SEC. This is a material financial obligation that must be publicly disclosed to shareholders. Such basic stuff.
Here's the real world rub when it comes to company valuation and market analysis for public companies. According to UNQL in its own press release, these new Asian Offices would have added 40% to the revenues and EBITDA. That's what they bought by their own admission. 40% more. (I'm personally shocked. I thought it would be at least 200% more revenues with all of those 30 Asian Offices. Wow!)
So, the public market looks at that and decides. Hmmmmmm
1) UNQL in the US has been a $10m market cap company for years now. If they add 40%, that's a $14m total market cap (and the purchase price should have been $4m.) But....man, that's a lot of debt on the books at $26m ($26m????) for this 40% addition. Maybe $10m market cap is about right still.
OR
2) Wait a second, hold the phone. You're telling me a $10m company paid $26m for a bunch of global offices that are 60% smaller in terms of revenues and earnings??? $26m??? That's insane!!!! $26m??? Why on Earth would they do something so stupid and fiscally irresponsible??? And with that much debt??? Do ya think maybe they overpaid by, oh, say 550%???
Annnnndddddd.....that's where we cue scene for the internet hucksters to scream "It's the most undervalued ticker on the OTC!!!!" Can't make this stuff up!