Not sure I agree at all. I do think it is strong confidence and a benefit to both sides and truly a win win situation.
Chuck gets his 75K up front to carry him but current trading value of Stratus is slightly down in around $1.60 to 2.00 range. The question should be why would Stratus or Chuck accept a Trade value of $2.30 per share. I'll give you my guess, if Chuck took his money now he would walk away with a another 75K max as per the deal and probably less as it would be straight payout. And yes Stratus does get the benefit of not outright having to a give straight cash payout as well as the fact it keeps Chuck's interests tied to the the company's well being as well.
Here is where I think it really sits and for starters keep in mind Stratus Media Group is at its lowest sits around a $100 Million Market Cap and generally has been alot more. It has very commonly in the very recent past has traded in around $2.30 per share and in Oct 2009 alone hit well above $2.50 per share that alone would have been a 10% increase in Chuck's money alone if taken at that point and tell me what Bank is going to give him that. None that I am aware of and that would again assume he actually get $75K to walk away with, not likely in my books!
But take a look at Yahoo Finance for Stratus the 1 Yr Est $16.32 per share. If that hold any anywhere near true Chuck walks away with another over $ 500,000 alone on top of his original payout portion. Tell me he wouldn't be winning on that side of the coin and I am going be sure to differ on that one. We also have to keep in mind this is also without Proelite kicking up its own storm and with that cash flow and from what I can see at this point things are coming together and its going to be Big, Really big! So look out! And it looks like Chuck Champion is up for the ride as well, which is great in my books! He's thinking he is betting on a winning horse and I am with him all the way. I would expect Proelite Stock to follow and in some sense lead with that to see some substantial increases in company value on both sides. Good for all of us in my view! IMO!
My Thoughts.
Go Proelite!
Peace!
