I don't think his intent is to drive the pps down. What purpose is there in giving shares to the Intrinsic Film people? I think this is why.
At one time or another, most startup companies work with a consultant or enter a contract with a strategic partner and are presented with a dilemma: should the company offer equity to the consultant or strategic partner in payment for services? For a cash-strapped startup, issuing stock or a warrant instead of paying cash is an easy way to preserve limited cash reserves while still growing the business. For a growing, successful startup, consultants and strategic partners may ask to receive equity instead of cash because they want to share in the company's upside potential. While equity can be a useful tool in these situations, you should be careful about when and how you use it.
