Don,
You are right in saying that the insiders got to buy more shares at a discount. On the other hand, the dilution was relatively small, and as M. Jacobs points out, the transaction costs practically zilch. At this stage of the game, for a company that still appears as risky as Pyng, there is probably no good alternative financing available other than a mix of equity and warrants. We shareholders might prefer if Pyng did more promotion of its stock, but M. Jacobs apparently has the strategy of instead conserving scarce funds and letting the results of the fieldwork trials and expected product orders take care of the price within the next 6 months. If this strategy pays off, we will have little to complain about. If it does not, there will be plenty cause for complaint, but it is reassuring to learn that the insiders believe in it enough to sink more money into Pyng shares.
It does seem sloppy, however, for the amount of the placement to increase from one week to the next. What happened here? Did one insider decide to pony up more money? Or did Pyng change its estimate of costs and needed finances? M. Jacobs did not respond to this point and should. |
