Except that they are not paying off debt with revenues. You pay off debt with profits and cash not revenues which are eaten up by costs. Costs of goods sold are 102% of revenues at last quarter - this is not startup costs or corporate overhead but as they say in the 10Q, expensive labor and ingredients that cost more than what they charge for the food.
As a result, they are actually issuing more new debt than they are "killing."
They have "paid back" convertible debt by issuing new dilutive convertible debt and issuing hugely dilutive new equity and equity derivatives. Outstanding shares from June 30, 2018 to Aug 16, 2019 have gone from 19.2MM to 68.2MM a 255% dilution! They have not had a single quarter of positive earnings or positive cash flow since inception. If you add up from June 2018 to June 2019 (financials filed in theotcmarkets.com) they have lost $2.5MM in earnings, lost $1.1MM in operating cash flow and lost $1.2MM in free cash flow. Worst NET ISSUANCE of convertible securities from 6/30/18 to 6/30/19 was $200K (they issued $1.2MM worth of convertibles and paid back $1MM - this is in fact getting worse as in the first six months of 2019 NET issuance was $410MM issuing over $1MM and paying back about $600K. They note that they have issued 5 dilutive (converting at a 40 to 50% discount to the then current stock price) and high interest (8 to 12% interest with a 10% OID) convertibles form 6/30/19 to 8/16/19 (so VERY recently) for a total of $437K while paying off $303K old convertibles (thus the $1.4MM "paid off" but at the same time over $1.6MM of new debt was issued) - thus "paid back in cash" means "paid back in cash" with the proceeds of new convertibles or stock or derivatives not with any non-existent restaurant profits. These aren't my words - it's the WCVC's words in its own financial filings.
This leaves them with over $5.7MM in CURRENT liabilities relative to $214MM in current liabilities (and only $78K in cash and equivalents) - NOT a healthy debt paydown situation!
No one issues a reverse split authorization as option value or a formality as it scares the heck out of people.
