I listened to a replay of the CC last night. Pretty good, but the drop is no surprise considering that the debt has not been handled.I know they are working on it, but there was some level of expectation built in, and really nothing was said.
The dilution part I didn't like. We are not children.. I totally get that dilution to pay off bad debt is fine, and I'd rather there be 600m OS at 4 cents a share than 500m at $0.005 a share. Problem is, the way Gary kept saying that, it seemed like he underestimates investors. I don't know who he's trying to convince or educate... but it comes across that he thinks that's the reason for the languishing price... When really, it's that this is a huge albatross around our neck and until it gets resolved, it will be. I appreciate the steps they're taking and hope they take more soon, but that shouldn't negate or minimize shareholder's concerns around the topic.
I also think that the vision needs a slight modification.. They're looking for angel investors for huge expansion. That's great, but there really need to be two tiers. We probably need $1-2 million cash to resolve this debt completely. That should be step 1. Get rid of the toxic debt, and then focus on these big expansion dreams. If someone is calling them today with $500k, a million, whatever.. they should take that and do so until they can pay off the defaulted loans completely.
Once that is done, then worry about all the larger aspirations.
All in all, I thought it was a fine call. Drop was no surprise, but long-term I feel the same or better than I did before, and I'm glad they made the effort to do something. For the record, people hating on Gary or saying he's old or whatever... That's not fair. Nothing he could have said would have made this go up, because there was an expectation that we'd get news about the debt, and we didn't. Tony Robbins couldn't have made the price go up.
The issue is not so much in what he says or how he says it, but the expectations that are created, specifically around debt this time. Those expectations are not met on the calls, price goes down. Doesn't necessarily make it a bad call.
