Art, you are neither a neophyte nor naive, so you know that in Pinkyville, companies often dilute not because they must but because they can. Urban Cassavant didn't need to dilute to the tune of 702 billion shares. As is all too common, it was simply a lifestyle decision.
So your earlier question is indeed the crux of it: "Do you believe James and Ken?"
The current skepticism is the result of James' and Ken's perceived disingenuousness. For whatever reasons one chooses to believe:
-- James gave out an OS figure that was approximately half the true number.
-- Borrowing a page from the man who killed his parents then threw himself on the mercy of the court as an orphan, they quadrupled the OS in less than a month then justified a reverse split on the basis of the resultant battered share price that was the inevitable result of their own dilution.
-- They buried the reverse split in a PR and did not divulge the split ratio in it.
-- In his Q&A with himself, Ken could have asked if he definitely would not convert any of his preferred to common shares in the next 12 months. He chose to ask himself if he "intended" to.
-- The PR yesterday was about as meaningful as if they announced that they pledge never to invade Poland.
So I am not saying that they will dilute or they won't. I am saying that -- for me -- they haven't earned the benefit of the doubt.
But I will continue to watch it. They made a real movie, produced an impressive trailer, hired professionals to hawk it at Cannes, and they appear to have other projects of varying potential in the pipeline.
It is not a matter of the company's viability. The linkage between that and ROI is tenuous at best in the over the counter marketplace.
