From the Disclaimer in the Patagonia STRONG BUY RECOMMENDATION:
"In order to be in full compliance with the Securities Act of 1933, Section 17(b), Patagonia Capital advises the readers of this document that it has received 67,500 common shares of Cerro Dorado under the terms of an eight-month consulting / marketing services contract, pursuant to which Patagonia Capital will be periodically writing and disseminating research reports on CDCH, in addition to providing the Company with public relations, investor relations, broker relations and other equity market / Internet consulting services. Patagonia Capital, its officers, directors, partners and employees / consultants may profit in the event the shares of the Company increase in value. These positions may be liquidated from time to time even after Patagonia Capital, its officers, directors, partners and employees / consultants have made positive comments regarding the Company."
Can someone explain why, with only 700,000 total shares outstanding, the company would dilute the company by nearly 10% just for a paid buy recommendation?
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