Actually I believe that it is 1 million line of credit, the rest is in convertible preferred stock, according to the way I read it.
This is a much better deal for DeSantis than it is for you and I.But I do not begrudge him that, he is the Knight in shining armor, so to speak. Nevertheless, it was a good move by management, and does buy us some time. As they stated, it lowers their interest rate substantially, so that is a good thing.
When did I say that the dilutive financing was a mistake? If you have followed these type of penny stocks for years, as I have, you would know that this is by far the most common type of financing that is done.
When faced with running out of money, or selling more equity in the company, which would you choose. It is simply finance 101, if you keep hemorraging cash, you have to keep financing from outside. When increased sales and positive cash flow kick in, if that ever happens, we will see a nice kick in the stock price. If I were in Mr. Haley's shoes, I would definitely be looking for more financing in the next few months, unless he knows that a nice surprise is in store for the shareholders come next earnings report.
I;ve been following this one for a year or so... you didn't even see 100K trade on the news... it's going to be like walgreens and the others... they get in... there are no reorders and it's back to the drawing board.. surprised this one doesn't trade sub penny.. dont get me wrong I own some at 4.5 but wont buy it at anything higher...