Notis Global Inc. (fka NGBL)

[loanranger]

I've taken the time and done the math. And posted the results:
"From the PR:
"According to management, prior to the split, common shares held just under 50% of stockholder equity and voting power(1). After the split, common shares hold 2/3 of stockholder equity and voting power(2). The total issued and outstanding shares of common stock and preferred stock on a fully diluted basis, which was 29,500,750 will then be 44,500,750."

(1) While technically true, the statement neglects to mention that the two company officers own around three quarters of the common shares. So between their common share holdings and their preferred share holdings they hold around 90% of the voting shares pre-split.

(2) Again, technically true...common shares will represent 2/3 of the voting shares. However, the total common and preferred holdings of the two officers will still represent over 80% of the voting shares post-split."
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=95185491

The above analysis clearly shows that the increased number of votes of the common shareholders other than the two officers/directors doesn't benefit them one iota relative to the control of the company. The holdings of the officers/directors would still represent 80% of the votes. In this deal, more voting shares does not mean "more voting control", although the company obviously wants to leave people with that perception.


As to the "millions of dollars in increased equity", that's just patently false as well. Not overstated....FALSE. The logic of the above explanation regarding votes also applies here, but it is even more direct and obvious. The equity of every common share, whether measured by the shareholder equity on the balance sheet or the market value based on common shares times the market price (market value) would change for the two director/officers in EXACTLY THE SAME PROPORTION as the equity of the non-insider common share holders. Obviously the total equity value of the company doesn't change....ALL common shareholders end up with twice as many shares, each of which is worth, in equity, half of what it was prior to the distribution.


"Then the company gave its shareholders an extra perk by not saturating the float with additional shares through an S-1 registration."
The chances of that S-1 being declared effective by the SEC were zero.


"The declaration date is the proposed date of FINRA approval."
Congratulations...that's a whole new definition of the term.


ps. I'll be very surprised if FINRA passes on this kind of action with a backdated record date. The three companies who have performed this action that I looked at set the record date to occur after the announcement. When saying "Post announcement the shares have maintained their value" one ignores the fact that shareholders had no opportunity to sell before the proposed record date. Wait and see what FINRA does.