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Sooky4810

05/08/11 4:26 PM

#25230 RE: guguli #25210

How I see it is the same as others, the higher EVCA pps, the less shares have to be sold. thats why I like the 8K.
Here's the beauty IMO >>
The pps doesn't get determined by how much money is needed, but the pps depicts how many shares are sold! IMO, thats not dilution and if it is, its a great way to do it so it doesn't devalue the shareholders shares. true, everyone wants the shares to be bought at a low price so they will be worth a bigger % down the road. Fact: money thats worth 250K is still worth 250K whether its 100,000 shares or 1000 shares. example 250K buys 250,000 shares, or 250K can buy 250 shares, when the pps goes up 20%, 250K is still 300K whether it was 250 shares or 250,000 shares.
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sevenOdouble

05/08/11 4:53 PM

#25233 RE: guguli #25210

Yes that should be around 5mil shares at 0.05/sh to obtain 250k and to stay below 4.99%/OS.

So it is in the company's best interest to drive the PPS up to atleast 0.05 in order to be compliant with that 4.99% rule.

It becomes a more difficult construction when you come to think about it. Let say they open one dealership/franchise per quarter and ask for an Advance with Auctus, then we ought to have 4 d/f per year, = 12df's in a 36 months contract with Auctus.
But their goal is much higher, so they will have to knock more frequently on Auctus's door to reach their goal.
10mil /250k = 40df's in 36months.
Which means in most Q's they will have to request 2 or 3 times 250k in order to keep up with the Plan.
But I don't think they'll use the whole amount (10mil) for d&f's, and that causes a decrease in their goals to open an d/f's in every state. (Maybe Dezer will throw in some additional cash...)

So if you take 5% dilution/df and we know that the SP will decrease with every new df because of that dilution, then it will be hard to maintain a high enough SP so they can stay below that 4.99% mark/OS.
Or they have to increase the OS substantially to able to comply with the agreement and according to the RRA they are going to increase that. Well, they have to anyway because Auctus is gonna purchase shares from EVCA per df/250k.

I'm just trying to know how much dilution there will be, spread over a 3 year period? A quick answer would be no more then 4.99% of the OS, which isn't so dramatic if you calculate that per sole basis... But we need plenty of df's, times 4.99% dilution per df....

PFFF I have a dozen scenario's flashing through my mind now...
I'm not going to explain further because I make it more complicated then it is...