Just a few thoughts;
1. The Sept 7th, 2022 could be just an arbitrary date where they confirmed there were no remaining shares to convert, and not necessarily when remaining shares were converted. What we do know is how the share structure has changed by following the unrestricted/restricted and total OS count. From previous filings, I see all of the Livingston restricted shares were unrestricted in 2020 and I'd be surprised if they didn't sell most of their shares before even the reverse merger. I'm sure some may have carried over into 2021. However, I don't think this is the source of our pains (more on it later).
Since December 2020, the company has not diluted a single share for the exception of one time. They confirmed this during the March 2022 filing where they laid out the history of no dilution that took place in over 18 months. The only time they diluted was in April 2022, where the OS increased by 32MM shares and so did the restricted share count. Then on June 29, 32MM shares restricted moved to unrestricted. This is not a coincidence and obviously the company needed 32MM shares for something. One theory could be that these were required for the conversion that they needed to satisfy immediately, hence why they confirmed in the filing you mentioned that as of Sept 7th, the agreement was settled, but was infact settled in Q2, 2022. Perhaps 32MM shares were issued and unrestricted for other reasons that we just don't know about. Regardless, only diluting 32MM shares in a 24 month time span is pretty remarkable.
2. I completely agree that broker-dealers/MMs sole purpose are to transact orders, and for every buy there is a sell. That source can be either common shareholders (us) or companies holding shares in the form of unrestricted shares that havent hit the float. However, I think it's wrong to assume that in this case, the source is the unrestricted shares being sold into the float because of the price erosion. The "bleeding" that we've been seeing is beyond just ENZC, majority of OTC stocks have been bleeding since February 2021. Looking at any OTC chart and you'll very likely see a spike in February 2021 followed by a slow decline. I think broker-dealers are the reason for this. Something fundamental changed in the OTC on that date.
For every buy there is sell and viceversa, but who's to say at what price? Assume you place a buy order above ask, and someone else places a sell order below bid, how do broker-dealers know what price to execute? What I've been noticing with my purchases is that broker-dealers have been executing my purchases at the bid eventhough my limit was set higher. This is great news for me, right? Yes, absolutely. However it's bad news for everyone else because my purchase now dropped the price.
This is price manipulation. Unfortunately, it seems like they are doing it in a perfectly legal and defensible way. The broker-dealer could justify their actions by saying "we are doing the buyer a favor and executing at the lowest price". If you however try placing a sell order, I bet you they will likely transact at or close to your limit versus at a higher price. What they should be doing is executing transactions in the midway point between the buyers and sellers price. I think it's intentional and deliberate. Literally happening right before our very eyes but unfortunately you have people fixated on price being a consequence of company progress when in reality the issue is systemic, tied to how orders are processed. If ENZC was only one of few stocks with a bleeding price, the issue wouldn't be systemic, the fact that most OTC companies are behaving the same way, makes for a very strong case.
AI
