I don’t agree with the notion 5 billion shares are going to show up in the OS in December. That is coming from elsewhere. First of all, I believe the Rule 144 aging on 12 months is actually not achieved until Feb 2022…as that is the 12 month anniversary of the ISSUANCE of those Pref B’s…not December. The clock starts when the stock is issued, not when the original agreement is signed.
Second, again…this isn’t about the 5 billion…which includes Footes stock. He has limitations on the rate he can sell…and that is where the “decades” comment is coming from. If someone wants the math, I can show it.
The issue is the non-affiliates. They have no Rule 144 restrictions, nor do they have lock-up or leak-out agreements in place. When that one year comes they are free to convert and sell. And it would take much of that Pref B stock to convert and hit the market to have an impact on the pps…and that will be an interesting dynamic if someone or a few people decide to cash out with the inflated pps as it is now. If it causes a rush for the exits or even 10% hits the market, it won’t be good.
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