Metal Arts Company (MTRT)

[FrankF]

Adding shares to A/S MOST LIKELY to facilitate a merger... I wonder "who" we might be merging with?

These guys? https://investorshub.advfn.com/boards/read_msg.aspx?message_id=165870457



But why do I say most likely "to facilitate a merger?"



SHORT EXPLANATION #1:
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=165869314

Medium s likely controlled by those three.
They will want to control MTRT.
They need to increase the AS to account for any possible conversion of the 5 million PS [Preferred Shares].
Plus they might need further shares for acquisitions or financing.
Increasing AS does not necessarily mean OS will be increased.
This is was normal event that was expected.
MTRT was not getting Medium for free.
This could quickly be moved onto Nasdaq.
Time will tell.

SORT EXPLANATION #2:
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=165869352

These merger plays are pretty much all the same:
Insiders get preferred shares to control the company without immediate dilution.
Authorized shares always are increased.
It doesn’t mean that the outstanding shares will increase anytime soon.
Unless they are getting some type of financing.
I am not shocked by the documents.
Let’s see what happens Monday.

LONGER EXPLANATION W/ HYPOTHETICAL NUMBERS:
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=165868883

If MEDIUM wanted to issue preferred shares to insiders just in order to maintain control, and if, just for example's sake the preferred shares had conversion rights of 400:1 (again, structured mostly for purpose of maintaining control), WOULDN'T THEY REQUIRE A LARGE ENOUGH A/S TO HYPOTHETICALLY CONVERT THEM EVEN IF THEY HAD NO INTENTIONS TO CONVERT THEM?

The point is, IT IS POSSIBLE -- we don't know yet -- that the 2B A/S proposal is mostly a formality so they can have their 5M preferred shares (and maintain control). (5,000,000 times "400" = 2B.)

More likely would be slightly smaller conversion rights, because it would leave room for share issuances for business needs, acquisitions, etc.

For example, 300:1.

Just to issue 5M preferred shares (for whatever reason) with conversion rights of 300:1... would require precisely 1,518,095,802 A/S.

(Because 13,095,802 shares are already issued and we would require an additional 1.5B more authorized just so the preferred shares could exist, plus another 5M for the preferreds themselves.)

But in that hypothetical case, a 1.5B A/S would leave no room to issue a single share for business needs or acquisitions.

If they wanted to issue at least some shares, which of course they do, it would make sense to make the A/S a bit higher than the portion that allows the preferred shares to exist.

For example, 2B instead of 1.5B.

Is something like this what MEDIUM has in mind?



Another consideration:

What did HMBL do after raising their A/S to 7.45B upon the merger with TSNP (almost 4 times as high as the 2B proposed for MEDIUM)? Gave insiders preferred shares? With the massive A/S increase being but a formality making it possible for those preferred shares to exist? Whatever the case, here we are nine months later and HMBL STILL has less than 1B O/S.

Again,

A/S DOES NOT EQUAL O/S . . .

and

a huge A/S increase that's never intended for actual issuance, is often used for facilitating the required conversion rights of preferred shares which are strategically used for maintaining control . . . AND having room to issue shares for acquisitions, etc.

IMHO