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Re: agribusiness72 post# 3477

Friday, 04/15/2011 2:00:27 AM

Friday, April 15, 2011 2:00:27 AM

Post# of 6560
There are a few flaws in your analysis that I'd like to point out:

This agreement is not a $30 million dilution. It is nothing more than the ability of CPOW to tap funds as needed to grow their business, but there are strict limits as to how much dilution can take place at any given time, and the terms governing the share price per dilution are extremely favorable to CPOW shareholders IMO (moreso than other similar agreements that I've seen in the past with other companies. Also, the investor is prohibited from owning more than 9.9% of the O/S and all shares owned are restricted meaning the investor would have to file with the SEC before being able to re-sell any shares.

What this agreement does IMO is show that an investor has done serious due diligence on CPOW and decided that instead of $15 million they'd like to invest as much as $30 million in CPOW, which affords CPOW the ability to accelerate their growth rapidly with cash on demand, subject to tight restrictions.

If you look at the history of other companies trading on the pinks or OTC, this type of dilution for projects considered to be favorable to the growth of the company often leads to much higher share prices. Look at a chart of GSDC, they recently tripled their outstanding shares at terms much less favorable to their shareholders (dilution took place at .10 per share when the stock price was .18) and shortly afterwards the stock price more than doubled.

Just some food for thought. I suggest you read the agreement carefully, and reconsider your math.

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