I think this sale leaseback is a poor signal by the company.
They are essentially taking a loan for ~13% interest to fund working capital needs.
Essentially, this company is bankrupt without this. They probably ran through the $85k that was on the balance sheet already.
Part of the liquidation book value calculation was that banks.com is worth at least $2 million. Now, they have chosen to monetize it for only $600k. If they do go bankrupt and don't exercise their option, they lose the domain name for less than it is worth.
13% seems like a fair market interest rate for this company. I just wish they would have been able to raise money some other way than taking debt. (i.e. selling other domain names. Even banks.com or irs.com if necessary at a good price.)
I don't think anyone is expecting much from these guys next quarter. I think Q1 will really decide the future of the company.
It looks like the CEO is loaning his own money to fund this acquistion! How many company CEOs use their own money!
Also, as you pointed out about the bullishness signal on volume:
Bullishness in past 10 days upside on very heavy volume. Prior months, the average volume were anemic in the 40K. Last 3 months volume has been skewed to 88K. Last 10 days volume average is 230K on increasing upside!
I feel like a pumper. :o)
However, the facts speak for themselves.
Likely, this bit of news helped: Banks.com Acquires Leading Online Tax Extension Site FileLater.com Completes Round of $700,000 in Financing Including $100,000 from Company CEO
Hmmm insider trading is just like last year. Except just with a different company. The interesting thing is that they get rid of some of their shares to free up cash at the wrong time. After they get rid, the share actual went up. I am expecting that the company want to focus on getting the most out of tax season and they need the capital to do so. What does everyone else think?