Bioelectronics Corp (BIEL)

[Dubb10]

I was keeping things relatively short for time and rambling. IMO, it revolves around the math of things. Perhaps you can explain the math to me and the hypotheticals since that is all we are left with at the moment while we wait.

So what is fair market value of Biel of what an external company perceives vs. what Andy believes after approval? Global traction in the products has not occurred as fast as we all hope. Would you not want to see what kind of traction Biel's cleared products have in the US market before agreeing to satisfy anything near Andy's terms of a buyout? If memory serves me correct, Andy was seeking some absurd value. Is an absurd value closer to $100M, $1B, or $10B? If anything, I'd want to make an initial investment, then have the door open for a buyout later on after I see US traction and overall costs. Even with a lucrative licensing agreement, is that going to be enough to cover a stock buyback (suggested by Andy via Jizmin) in addition to maturing debt plus continued and/or increasing global and US production/marketing? Those are pretty high expectations. I can see a lucrative agreement helping to cover debt, marketing, and increased production. To initiate a substantial stock buyback is going to require quite a bit of capital, depending on what the stock is trading at when it occurs.

I was originally referring the idea of stock buyback which typically occurs when the company believes the stock is undervalued. It would be one thing if the O/S was 6M, 60M, or even 600M. 6+B is a different ballpark. In addition to the costs that I mentioned, you have to factor in how much something like that would cost in order to drastically reduce the current share structure. A high share structure creates volatility, and I can't imagine that a private investor or another company wants such a volatile stock to invest in. To (very) conservatively look at things, let's just say Biel wants to reduce its O/S down to 3B to create better PPS stability (typically much less than that which is closer to 30M to 300M instead of 3B). Let's say that Biel insiders personally control 2.5B, and the company wants to buy back 3B shares at the current market value of .0026 cents per share to drastically reduce the float. That buyback cost alone would be $7.8M. If the PPS substantially spikes after clearance, then we are looking at much more than that.

I agree that after FDA approval that things will open up for Biel. The questions(problems) are when that will happen and at what price Andy and the majority shareholders considers to be fair market value. As I have pointed out tirelessly, I think clearance will be later than sooner, depending on what (and when) the FDA decides. While we all wait for the clearance process to unfold, debt is still due, and operations need to continue. Their products aren't gaining enough traction globally at this time. We will have to see the rate of sales increase during 2Q14 and 3Q14.