One of the reasons why we are talking about a reverse split, is because Derek brought up the scenarios on the last conference call.
He said he would be open to a reverse split if he had a chance of up listing, and if someone wanted to buy into the company like canopy growth just did by giving away 10% of the company for 275 million dollars.
The big second reason ...the main reason. Is that the company is running out of shares to sell.
They only have 88 million shares left to dilute, and they can go through that really fast.
With 1 billion shares outstanding and a huge float...the free common shareholder ATM machine is about dry up lol
That is why the PPS is stuck in this pathetic range of .18- .50 for 3 years.
Dilution and toxic financing destroys shareholder worth..
Here is the impact of TRTC’s convertible note addiction of common shareholders.
The table below, which illustrates the rate at which outstanding shares have increased over the past five years, answers this question.
Year TRTC shares outstanding
2012 76.89 million
2013 99.04 million
2014 174.3 million
2015 240.19 million
2016 389.36 million
As of December 11th 2017 903.17 million
The shares outstanding are nearing the authorized share limit of 990 million
In five years, TRTC’s shares outstanding have increased more than tenfold and are now inching dangerously close to its authorized shares of 990 million. This means that going forward there is very limited room for TRTC’s debt holders to convert their debt into new shares. This heightens the prospect that TRTC may default on its debt. In case this happens, shareholders will be first to lose as debt owners will foreclose on the assets. This is the benefit of being a debt holder as opposed to being a shareholder. Debt holders usually have the first claim on a company’s assets in the event of foreclosure.
To avert foreclosure and stay in business, the only foreseeable play for TRTC will be to effect a reverse split. A reverse split is where a company merges existing shares using a ratio—for example 1 share for every 20—in order to reduce the outstanding shares. This action increase the share price, but reduces the shares outstanding, meaning that it has no effect on the company’s overall value. Fewer outstanding shares also gives a company—in this case TRTC—room to create new shares in future, opening the way for more convertible notes and continued dilution of common shareholders.
Poor management
