TREES Corporation (CANN)

[Alan Brochstein]

I don't think I criticized the company for issuing warrants, though it didn't seem like a great deal (but reflected their terrible financial position). I actually like warrants as opposed to toxic convertible notes. I will criticize them for a lot of other things, like letting their balance sheet turn to crap and for overpromising and under delivering on all sorts of things.

Here's the deal: What will happen when 9mm warrants come unlocked? Will the sellers find buyers for 9mm shares anywhere near here? I doubt it. If they sell it down to $1, they make over $4mm for lending $3mm to the company (and hopefully will get their $3mm back plus 12% interest).

Being a common stock holder for OTC companies is brutal. Better to be a lender with warrants!