RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:Short term pain, mid term gainlscfa wrote: Another BS argument of underwriters is that the financing must be offered at a discount to the market price because of dilution. Might be true for co.s that need the cash to keep the lights on but
I have seen cash flow positive co.s who explicating state that the proceeds will be used for accretive purposes and the frigging underwriters still price issue at a discount.
lscfa wrote:
Many small co.s do an equity issue with 1/2 warrant so giving up a whole warrant means OILS is desperate for cash?
signreader wrote: I agree with you. The next time Paul goes on the screen to talk of his excitement I am going ot throw up. Raising money for operations is understandable but why clobber the price down to such pathetic numbers and on top of that a sweetheart deal of warrants at 27c for the next 2 years??? Paul if you can read this, yourshareholders have suffered for too long. No more excitement pls, just deliver on your promises!
The underwriters don't have a duty to act as a fiduciary. if anything, they have a duty to their own shareholders to generate as much wealth as possible. This means pricing deals at below-market prices so they're easier to sell and to create a strong investor base who continues to buy the deals they underwrite.
This is a very shady deal and leads me to believe there is a conflict of interest. Nextleaf didn't need to price the deal at a 20% discount to raise $3mm equity.