This Easter Egg from February still Intrigues me!I've mentioned this before in a reply back in Feburary. Back in February CNC had a press release about their stock options,but andEaster Egg at the Bottom was very interesting:
Finally, the Company has agreed to issue a total of 135,000 common shares in settlement of $472,500 owing to certain service providers, subject to approval of the TSX Venture Exchange. Such shares will be subject to a four month hold under applicable securities laws.
CNC owed its contractor(s) $472,000. Instead of rasing the capital through a follow up offering, they paid those contractors in stock that was locked for 4 months. I once owned a small business (a flower shop) and I needed a steady cash flow. Tomorrow's bookings paid yesterday's bills. If CNC paid these companies in stock they would have been like "Dude. I've Got bills to pay. My Employees need to cover mortgages and put food on the table. Explain to me why I should take some stock that can't be sold for 4 months. Tell me what have you got?'.
Getting back to the Flower Shop. If I catered to a large Christmas Party to a company that offered me stock instead of cash, I'd say, "I have to pay Hydro, suppliers and employees. What's the difference between giving me stock I can't and raising the capital yourself? I have to use my like of credit to pay this bill. Tell me What have you got here?".
My two cents worth.