TLSS--I was here for that initial run to .09 cents.
Right after that run, it was pounded mercilessly pretty much day after day, culminating in the dips to below .02 cents. By my account the dilution stopped at around 2:00 last Friday, and the dilutive market makers have not made an appearance on L2 since.
I will hazard a guess, that probably 150--200 million shares were introduced into the OS, and likely the float, (remember those 13G's and Form 4's, which outlined such activity the past 2 weeks?).
They had a note for about $2.84 million and then there was the debt re-negotiated by their turnaround specialist Sebastian Giordano, which removed another $1.7 million in debt, but they had to issue shares in that situation as well. So, rough math by combining the two, you get around $5 million in debt, that was paid off with the aforementioned dilution.
What a lot of people don't understand is the ACTUAL cost of the $5 million debt. So I will try to explain, for those that do not.
If TLSS wants to pay off $5,000,000.00 in debt, they utilize toxic diluters and their collective FUNNY math. This math involves terms such as ratchet clauses and 80% of the VWAP, (Volume Weighted Average Price). So let's look at a scenario as such:
One would figure that to pay off that $5 million, they would simply have needed to issue 100 million shares as 5% of 100 million, is $5,000,000.00. This is where things get a little dicey. Most of these toxic diluters have a ratchet clause built into the notes, which in almost EVERY case, get exercised. That allows provisions by which, as the share price goes lower, the amount of shares now needed can be
25--50% higher, or in this case, to pay off that $5 million, you might now have to issue 125--150 million shares. It gets even better.
So to insure that the ratchet clause is kicked in, the toxic financiers work together with shorts, to exacerbate the situation even further by shorting the equity. The lower it goes, the more shares the company will have to issue to pay off the $5.0 million. Then, according to the contract, the VWAP starts getting tracked for the five days prior to the issuance of these shares. Then, the financiers, per the contract, get a discount price relative to VWAP. In this instance, the contract ratcheted the price down to about .03 cents. So an 80% discount off of the .03 cent average price, means that the diluters are able to convert their shares at approximately .0024, (80% of .03 = .0024).
So now that 100 million share issuance to pay back $5 million, with the ratchet clause in full effect, and then the 80% discount factored from the VWAP in the five days before the shares are issued, means that in all likelihood that $5 million at a strike price of .0024, means that now, the company must issue approximately 200 million shares, a full 100 million more shares.
I am trying to simplify this concept so that people have a better understanding of how we got down to these ludicrous prices.
So we can draw the conclusion from the aforementioned that in all likelihood TLSS was forced to issue anywhere between 150--200 million shares to pay that $5,000,000.00 debt.
So, yes, I believe the debt has been paid off.
Despite the extra shares, this company should not be down at these levels.
Hope that helps,
SPORTYNORTY
AI
