How this is playing out...
Based on what I've seen, here's my guess at what's going on. The "prior investors" are selling their shares, and borrowing your shares to (short) sell those too. This way they can make money when the price goes down, and lock in a bigger pay day (more shares) when the units separate in seven weeks with the cashless warrants. For them, it's a win-win. There's no news on the horizons, and having inside knowledge of the company's plans, my guess is that they have no fear of a short squeeze in the next seven weeks.
Even if there is some "news" between now and then, it is likely that insiders will just use this as an opportunity for more shorting. Every time we've seen an announcement- which should normally be good for shareholders- the share price has dropped. This stock has failed to sustain any gains in more than a year. It's basically been a giant dump. I wouldn't be surprised if the company somehow modifies the units to allow the prior investors to exercise their warrants and get out early as well.
Looking at their track record, this management team has been great at destroying shareholder value, which is why it's often more profitable to short any stocks they're involved with. Shorting this stock a year ago would have been quite a nice return (nearly 100%) and if looks like short interest has jumped up quite a bit in the last month as well. This suggests more pain for anyone buying into the hype. Based on all the damage done to this point, it seems are chances of a "turnaround" before the units separate gets exponentially smaller by the day.
Just my two cents.
