It seems that most people here don't understand how this LOC works. It's not like your 2nd mortgage where you borrow money and pay back a portion of principle plus a months interest every month. How this works is that when Kim makes a draw, he gets money by Calm Seas purchasing his stock. Calm Seas then engineers a pump to sell those shares into. That's how they get paid back. As long as they have confidence in their ability to pump the stock, they'll lend him money all day and night. Thompson never has to make a nickle because he's not paying them back, stock purchasers are paying Calm Seas back. Thompson just draws money from the LOC by selling Calm Seas stock, and they get their money back on the open market. It's not like KBLB is making monthly payments at 6% annual interest or anything. Calm Seas has no interest or concern whether KBLB ever does a damn thing. Their only concern is their own ability to pump the stock and sell their shares. They aren't betting on spider silk or anything else. Calm Seas is betting on their own ability to create an environment into which they can sell shares of KBLB into.
Correct me if I'm wrong, and explain to me at what annual interest rate KBLB is paying Calm Seas back, and also what is the schedule for repayment. KBLB will never make a payment on this loan. Calm Seas recovers their money by selling shares into the open market after engineering a pump to inflate the share price and attract new stock purchasers. Does that help explain why some of us STOCKHOLDERS don't like this kind of thing? Our lender has no concern or interest in our success, only their own ability to pump the stock price and get investors to buy at those inflated prices. This is why it's so damn important that Kim IS NOT a party to this. If he is, our Bahama dreams will soon be portfolio nightmares.
