Monster Digital Inc fka MSDI

[4toSchool]

My interpretation of the 8-K is that Innovative and Monster recognize that any $5, or greater, outstanding warrants or options are worthless as they agreed to exclude them from the valuation calculation.

For purposes of calculating the exchange ratio, outstanding warrants and options of Monster with a per share exercise price of $5.00 or greater would be excluded from Monster’s capitalization, as described in the Merger Agreement. Affiliates of Monster have entered into agreements in support of the proposed transaction.

This also means that any warrants and options less than $5 WILL BE INCLUDED in the valuation, which is not good for current MSDI shareholders. Also, the calculations will be modified based on cash levels. Monster continues to burn through cash at a staggering rate. The only way they've stayed afloat is by dilution, issuing more shares to raise capital. Therefore, one can reasonably infer that without further dilution, the future amount of cash that Monster will have on hand will be lower than today. This will lower the value to current Monster shareholders.

What is the value of the reverse merger for current MSDI stockholders? IMHO the company today is worthless, a cash-flow mess, a dilution nightmare. The only value is that current investors might receive something for their current shares. I DO NOT SEE MSDI SHAREHOLDERS ENJOINING A PREMIUM FOR THEIR MSDI STOCK.

Personally, I am out.

All IMHO

GLTA