The value of the holdings owned by existing shareholders is usually decimated when OTC stocks do a substantial reverse split. The share price immediately following the RS is supposed to be inflated by the split percentage (split-adjusted price). However toxic dilution almost always resumes and the share price continues to retreat -- often until there is no published bid if the new dilution is massive.
In all of my years of following OTC stocks, I've never seen one with such a massive already known share issuance obligation. $2 million worth of stock is supposed to be issued to ECVI (the purchaser of the debts) to pay the debtees included in the Section 3(a)(10) action.
$2 million in stock issued at a step discount is horrendously dilutive. It's even worse that there is no real gain for the company or its shareholders.
Given knowledge of the obligation to issue such a massive quantity of free-trading shares and that those shares will be sold to pay the included debtees as well as the disclosure in the SEC filings of a possible reverse split, it is not "rational" (as the term in used in the study of economics) for anyone to purchase the stock. There is almost no likelihood of a sustainable increase in the share price.
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