Share structure question per jim morris
With regards to the restructuring I asked and here's what he said
What jim says here MAKES sense! This is a startup comapny and we have to fund our product... Here's his response...
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"The reason there isn't any real benefit to current shareholders is because although the O/S was reduced the maximum authorized share count (A/S) was not reduced at the same time."
Balderdash.
1. We need to raise operating cash by selling shares of stock until we reach profitability.
2. The only way we can raise operating cash at the present time is by selling free-trading shares.
3. I am always looking for ways to raise operating cash by selling restricted shares. I have been doing so for over two years.
4. Until we have "significant" customers and revenue, we are considered too risky for institutional investors to buy restricted shares that they cannot sell for at least one year.
5. The A/S is a red herring. Since management has controlling ownership of Lecere, we can raise or lower the A/S by calling a shareholder meeting. The outcome of the vote is a foregone conclusion.
6. We don't yet know how much more common stock we will have to sell in order to reach profitability, so if we lowered the A/S, we would just have to raise it again if we ran up against an A/S limit before we reached profitability.
7. Shareholder meetings are expensive (lawyers and transfer agent fees and other fees) and time-consuming. We need to use our money wisely and stay focused on getting customers and revenues, not fooling around with the A/S just so we can get a bump in share price. One benefit to shareholders (certainly not the only one) from the recent decrease in the O/S was that we did not have to pay out a lot of our precious operating cash on lawyers and TA fees and other fees for a shareholder meeting to raise the A/S.
8. We are focused 100% on getting as many customers as we can and as much revenue as we can as fast as we can with the limited manpower that we can afford on the limited amount of operating cash that we are able to raise today.
9. Customer growth and revenue growth are what will give maximum benefit to shareholders, not A/S games.
The benefit to shareholders is this: We sell stock to raise operating cash to develop and sell our product so that we can get customer and revenue growth so that we will thus be more attractive to investors who will thus buy more stock and thus create more demand for our stock that will thus raise our market cap and thus give an excellent return on investment to shareholders for many years to come as we increase our market cap over time.
That is our plan. Nothing sinister. Just day to day execution to the best of our ability.
Jim Morris
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