Replies to post #287133 on Digital Brand Media and Marketing Group Inc (DBMM)

[johnydollar]

The companies that kramer lended money were not worthless.

They were worth every penny for him, that is why he made millions converting, plus the illegal shares he acquired in the process.

[Jetmek_03052]

Why would a company lend money to another company that’s worthless?

Easy to answer! Death Spiral lenders just care about one thing. Getting their money. DBMM's wonderful management team made it easy to continually convert shares they got in the loan agreement, at lower than market price. It was like a money faucet. DBMM management didn't care - there were PLENTY of shares and if they ran out of shares? Simply authorize more.

There was NO DECEPTION. Yes, it was foolhardy to enter into that loan, but DBMM management did so with the FULL KNOWLEDGE of the loan conditions.

And I'm not a Kramer fan. He's a skunk. But the facts remains - DBMM management knew the conditions of the loan and YET ENTERED INTO IT WILLINGLY.

[Stock_Barber]

Why would a company lend money to another company that’s worthless?

Is that a serious question?

Kramer would loan money to any POS that was publicly traded in exchange for heavily discounted shares which he would flip for free money! Probably 99% of public companies that were desperate enough to come to Kramer aren't around anymore!

Shouldntvthrte be some kind of collateral?

Isn't that a really good question for the LTIs?

Kramer got discounted shares... what were the LTI's promised in exchange for their money? NO ONE KNOWS...

At least Kramer was transparent about what his cut was!

[Gotham Bay Group]

I can see the confusion. This type of lending doesn't fall under your quoted idea of predative lending.
"The practice of a lender deceptively convincing borrowers to agree to unfair and abusive loan terms, or systematically violating those terms in ways that make it difficult for the borrower to defend against".

The financier is doing the same thing you did as a shareholder. They agreed to take shares as collateral for any funds received. Only reason this is done, is because of the discount. If the financier were to sell the shares at that moment, the value would be greater than the funding. Has noting to do with the companies value. Has to do with the value of your shares.
Obviously, the toxic part comes in the fine print. This is different from predatory lending. Most these financings are done with the knowledge going in, they will not keep the agreements regarding sale of the shares. These loan sharks know that the company will likely not be able to defend itself against any contract breach and bankruptcy will follow.