Replies to post #141933 on TON Strategy Company (TONX)

[TenKay]

There could be a number of reasons why they did this. The most obvious was that AGP couldn’t move the stock it wanted to and had to offload some and the only viable option was for SC to use what was, in effect, AGP’s money to buy it back. The refund was to AGP, not Verb.

It could have been the only way to keep this from going sideways...and perhaps keep AGP from dumping it in the market.

As for SC...they are making out well at $25 million even with only $11 million of it in cash...that is close to 1x sales on the cash portion alone. It’s not like someone else was willing to pay that for them...or would come in behind Verb if it failed....Verb paid a premium...if evidenced by nothing more than the fact over $24 million of the $25 million “value” had to be booked as “goodwill” on the balance sheet for the transaction.

[roni1]

Hi Roni, let me clarify.

The acquisition price was $25M ($11M cash, $10M in restricted common shares and $4M in units at the same terms as all other investors in the IPO).

The way the units component of the purchase price worked was we paid them the $4M in cash and they gave it back to us in exchange for units in the IPO so that our net cash outlay from the IPO proceeds was $11M instead of $15M as set forth in the original merger agreement. It net the Company an additional $4M of working capital.

In total over $20M was raised in the IPO, including the $4M from the Sound Concepts shareholders.

Please reach out anytime.

Valter Pinto,
Managing Director