Competitive Companies Inc. (fka CCOP)

[LGL8054]

THIS IS THAT TAKES PLACE THEN A Co. can't sell stock to rase cash.
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Posted by: Charlatan
In reply to: PASHA who wrote msg# 19375 Date:7/20/2007 8:19:20 PM
Post #of 19428

I would agree with that post, but what that post fails to mention and which is notorious in the Pinksheets is how the dillution itself is structured. Most Pinksheet Companies have bad credit, massive liabilities and couldn't get a loan from a pawn shop if they tried. So they go to those nasty folks that are drooling at the chance to "loan" the company money. The Company is desperate for cash so they have no choice. Now the Company has a loan that it can't repay because the intrest rate is so outrageous they can barely even pay that. So the Company defaults and the Note holder converts his Promissory notes into common stock. Alot of times these notes convert as high as 50% discount of the 10 day average. The lower the price goes the more shares they are able to convert. It's a death spiral for the company and it why so many of these companies get driven all the way to .0001 with no bid.

It's not the Company rolling the presses as many think. It's simply Management making bad decsions and entering nasty PIPES that pretty much kill the company. Once it gets to a point of insanity they simply R/S and continue to convert.

Here is an excellent article that everyone should read and learn from.
http://investorshub.advfn.com/boards/read_msg.asp?Message_id=21312328&txt2find=sewer