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Re: clawmann post# 70155

Tuesday, 04/25/2006 1:26:47 PM

Tuesday, April 25, 2006 1:26:47 PM

Post# of 326354
Claw, it's the more probable bet (literally): The machinations of Cornell financing are such that, more times than not (and that's very important to a disinterested trader), the share price will fall. Toxicity is present in that Cornell makes money regardless, and as the price falls, it increases downward momentum since a reduced share price necessitates the creation of more shares to satisfy the Cornell contract. As more and more shares are sold, the price falls more and more, necessitating the creation of more shares, etc.

That is the extreme case. NEOM's shares are not even close to this type of end-game. And NEOM has a degree of substance and could only grow by dealing with the unsavory Cornell. It is likely that NEOM will satisfy its present obligations and refrain from additional indebtedness (many companies actually make it a point in highly celebrated PRs announcing their disassociation with Cornell). I'm sure NEOM looks forward to that day.

I would view it as a death-knell if, by now, NEOM had to become increasingly indebted (beyond the heavy price it is now paying for past financing) to Cornell.