Mactex,
Good points to discuss. First off, on Cornell's restriction to 9.9 percent; IMO this doesn't effect the extent of dilution because cornell has no intention of holding the shares they get. Cornell makes money by selling all the shares they are given on the open market. They loan money in return for cheap stock, which they dump for cash. IMO, they are not a partner to neomedia, nor are they an investor. And their only real risk is that the stock becomes worthless; however, there's a big difference between worthless and a .05 cent stock. They don't care whether they have to sell 1 million shares of stock at a dollar or 100 million shares of stock at 1 cent. We care, but they don't. If Neom wants Cornell's cash, they will continue to dilute, cornell will continue to sell (keeping their holdings below 9.9 percent) and the stock price will go down. Neom will put out prs to hold the price as high as possible to keep the dilution down as low as possible, but they'd need some serious pr's to get us higher.
Now, as for a much more difficult discussion, you quote Neom's management (i assume that's who The Man is) as saying "The man said (on our dilution concerns to him)"with a stock price of $5/10/ or 20 dilution is a non-issue". IMO, and no disrespect to anyone intended, this sounds like salesman talk to me. And a bad salesman at that. At 5 dollars this is a 2 billion dollar company- because of dilution! At 10 dollars, this would have to be a 4 billion dollar company! And at 20 dollars, an 8 billion dollar company! do you realize how absurd that is? A company with no real revenues, whose only investment comes from a stock for cash vulture deal, being valued at 8 billion dollars? Not possible. the stock price can not reach these numbers BECAUSE of the dilution, so it's absurd to state that the dilution won't matter as the stock price rises. If dilution continues to occur, the stock price CAN"T rise. The more dilution that occurs, the LESS the stock price can rise. If Neom's management made this statement on wall street to a vc firm, the vc firm would laugh and walk out the door. Any investor would be frightened by this bizarre logic.
The only way to raise the pps is for the value of the company to move foward faster than the dilution. Now if that's what the Man meant by this statement, then okay, what he should have said was that although the dilution is horrible for the current investors, it is necessary to help us reach our goals, creating enough revenue to sustain the higher market cap we'll need to reach to make the pps continue to rise. However, the idea that we can be a 20 dollar stock with half a billion shares, or more, on the market, is ridiculous. I love the word registry and i like paperclick, but i ain't seeing a ten billion dollar company any time soon. I'm still seeing my 150 million dollar company. If we dilute to 500 million shares, which i foresee in the next couple of months at this rate, then we're lookign at a pps about where we are now. And if we dilue further, that pps won't rise.
Look, bottom line is, neom has a plan for that 100 million bucks, and i'm praying that plan includes a big enough piece of news to make the company look good enough to get past it's horrid financial situation. I'm betting on that fact, along with the rest of the longs. But i am not hiding my eyes to the current situation or the ugliness of the means to our end.
best
Joe
