Positron Corporation (POSC)

[zenvesting]

I accumulated a little more than 235,000 shares here over the past year between $0.035 and $0.12.

First I must disclose the risk, there is a large dilution risk of the outstanding unsecured notes being converted. In the bankruptcy docs filed with the SEC, this conversion is specified under Class 6 Creditors, Section 4.8. Page 5 of 11, of Exhibit 1, to this link explains the terms of their unsecured notes: https://www.bamsec.com/filing/161577418007286/3?cik=844985

As you can see, there was about $1.1 million of unsecured debt outstanding, subject to conversion at a 45% discount to the current price of the stock. So at the current $0.10/share, that would be $0.055 conversion price for 20,000,000 more shares, giving us a company majority controlled by the creditor. I've been in contact with Adel Abdullah, he said: the creditor(s) have represented that they will be very fair in conversion as they all know many of our shareholder base. I’m confident they will be converting in near future and at a fair value which I suspect is at current levels.

In spite of these financial challenges, the company is making sales thanks to the support of new research that proves PET MPI imaging is superior to SPECT in quality of imaging, thus catching a higher percentage of the at risk population and reducing the amount of radiation exposure. Here's the summary of one such recent study: https://www.sciencedaily.com/releases/2018/03/180310165832.htm

Dr. Lance Gould at the University of Texas, Health Science Center at Houston is one of the key researchers advancing R&D that proves PET is superior to SPECT, he also provides data that helps refine Positron's coronary Flow Reserve (CFR) data overlay, in addition to other researchers and practicioners:
https://www.eurekalert.org/pub_releases/2018-02/uoth-ukl022718.php

Positron's advantage in the market is that they are the only company making a dedicated cardiac PET camera without a CT tube, because CT tubes are an expensive component with a relatively short lifespan that significantly increase cost of ownership for the dedicated cardiology practice, which has little use for the CT in their practice.

During my conversation, I also asked Adel about the two identical PRs about sales, one released on the company's website on 9/6/2018 and one released to the newswire on 10/2/2018. Adel explained that this was not a one-off sale, but that the company had begun making multiple sales again in 2018 after not making any sales for about a five year period from 2013 when they declared bankruptcy.