FYI, Got this information from another message board
Calm down people
I think a lot of people are missing the point for the direct buy option that has just been announced. NOTHING IS HAPPENING TO YOUR EXISTING SHARES! The first problem is people are reading dilution and equating it to their own respective stock price value and holdings. The dilution Jeff is talking about has nothing to do with that. If you have 1 million shares, you’ll still have 1 million shares. That isn’t changing. What he means by dilution is your percentage of ownership stake in the company will be diluted. For example, to keep it simple, a company has 100 shares on the market owned by 4 different people. Each person for this example owns 20 shares leaving 20 shares outstanding. They all have an equal 25% stake in the company. Along the way on person decides that he is now going to buy the remaining 20 shares. He now has a 40% stake in the company diluting the other 3 people’s to 20% (60%/60shares divided by the 3 remaining people) the first person now has a larger ownership in the company. The money put in by the other three remains the same and so does their share numbers. Only their ownership percentage changed.
The next thin is people miss reading the 4:1 section. This doesn’t mean that if you have 1M shares you’ll now have 250k. That is a reverse split exactly what Jeff said this wasn’t. Instead what that is saying is if you own 1 million shares, you well be granted the opportunity to buy up to 250k at the discount price. AGAIN, NOTHING HAPPENS TO YOUR ORIGINAL SHARES.
