Dilution?
"6. Will this transaction be dilutive?
No, as explained earlier. We emphasize that the transaction with Ironridge currently does not involve an issuance of any new number of shares of common stock to the marketplace. Rather, we believe that there was a zero-sum and little-to-no dilutive effect with an equal number of shares in treasury retired in exchange for shares distributed to Ironridge."
What is meant by shares in treasury retired?
One interpretation is that some of the outstanding shares are owned by the company itself. If this is correct it is not right to calculate earnings per share based on the number of shares outstanding in my view. Earnings per share should be based on the number of shares owned by others not including those owned by the company.
On the other hand the shares issued will be dilutive the way I see it. How dilutive depends on the stock price in coming weeks. The shares seem to be issued at a discount of 20 %. The reference to issuing shares at $ 1.5 turns out to have been so much wishful thinking with no validity.
It seems that the company sorely needs the cash to be raised to pay off debt to valued creditors. There should have been some discussion of the possibiity to borrow the money from some source.
News 
Market Data 
Discover 
