Auric - wrong again, as usual:
1. I had the opportunity to sell my stock when ATG was at $1.12 per share and when it was at $17 per share(and every day before or since that I have owned it) - I chose not to do so (sometimes I wish I had sold some and bought back on the dips, but that was my choice). So Fred did not sell any shares at my expense, nor was he disingenuous toward me or any other stockholder -- I have always assumed that any officer of ATG (including Fred) might sell some percentage of his shares - that is what corporate officers and directors do from time to time. You seem to think it is always nefarious and motivated by evil intent -- maybe you are ascribing to the CEO of Ashton the motivations you would have had if you were in his shoes, since you seem to be a ill motivated individual. In fact, Fred did not sell at the top price then (it was trading well over $13 for a reasonable part of the period between May and July, when he sold) and the price may (no, I take that back -- WILL) trade higher than the price he sold his shares for in the relatively near future, probably within the next few weeks (if not days). So, with all due respect, it is you who is being disingenuous to imply that a sale of just over 10% of one's beneficial ownership of a company one founded is somehow automatically adverse to the stockholders or motivated by evil. I challenge you to name a company where insider sales of the type and magnitude completed by Fred Rittereiser in July have NOT taken place. It is just a huge non-issue, yet you continue to whine on and on about it. Give it a rest already.
2. The stock converts for $10.79 per share. 30% below market only applies if the stock itself falls to 30% below where it is today, and then it floors out at $7.85 until 2/00. After February 2000, the floor goes away, but ATG can redeem the preferred if it is more advantageous to do so than allowing the lower priced conversions. So your 30% below market statement is what is disingenuous -- if the stock converts at lower prices, it is because the market price of the stock is lower, and if that happens, the conversion formula would likely require Rose Glen to convert at a higher price than the then current market.
But here's the rub -- in 1998, when the first major convertible equity PP was completed, the stock price was in the $2-3 range, and it was painfully obvious that the issuance would be dilutive, although the put provisions were helpful to allow the company to control to some extent how much dilution it would suffer. It was not floorless, but admittedly very dilutive. Now the stock is trading at $10.50, and highly likely to improve in price in the months ahead as VTS phases in (starting this Friday). To hear you describe it, Rose Glen obviously invested in ATG in the hope that the stock would get crushed so they could get more common out of its conversions, which is absurd. The adjustment provisions you allude to protect Rose Glen from a huge hit if the price of the stock tanks on the heels of a $20 MM equity investment -- and they also protect ATG if the Board concludes that the conversions are more dilutive than they are comfortable with due to any sustained (22 trading day) downward trend in the stock price -- but that ONLY arises if the stock is, at that point, considerably cheaper than it is today. In which case, the conversions take place at slightly higher than "then" market prices.
So this is what it all boils down to. If ATG is a pump and dump sham, which pulled the wool over the SEC's eyes to secure SEC approval of a major trading system, pulled the wool over the eyes of various institutions who have by now invested upwards of $35 Million in the company, and which consistently lies to its stockholders and the world in order to commit fraud and securities crimes, then yes, we all agree that the stock will tank and, as a result, the Rose Glen conversions will be pricier and more dilutive than the $10.79 price seems to indicate. For that matter, if VTS and UTS are complete failures so that ATG's stock heads for the dumper, that too will cause the Rose Glen conversions to be pricier and more dilutive than the $10.79 price seems to indicate. On the other hand, if ATG is not a sham, but a legitimate company, if the SEC knew what it was doing when it approved VTS, if ATG's statements to the media about 50-100 institutions (including several gorillas -- that is larger and prominent institutions) participating in VTS are not false, if VTS is a success, and if ATG succeeds in rolling out eOX, eAs and eMC on an accelerated basis (and, for that matter, takes Gomez public), then the Rose Glen conversions will go off at $10.79 and not be especially dilutive, the $$$ brought in will translate to profits and value creation, the Board's exercise of its good faith business judgment in making this PP will be completely vindicated, the stock will be worth multiples of what it is today (even with the extra 2 Million shares issuable on conversion of the Rose Glen preferred and the exercise of the Rose Glen $12.26 warrants then outstanding) and all of your gloom and doom BS will be exposed for what it is -- unadulterated BS.
It's funny . . . . back in April, you predicted that P & D insider sales and floorless equity conversions would tank ATG's stock -- it is now four months later (late August): The stock is trading at $10.50 and seemingly heading back to highs even you have to admit caught you by surprise, and here you are, singing the same old song, except this time on much shakier ground. The only dilution I see is in the persuasiveness of your position -- it was weak to begin with, even weaker now. ATG is not a fraud -- whether it succeeds over the long haul is still very much an issue which is worthy of discussion and consideration by its stockholders and potential investors, but only on its own merits, not on lies you have built around Fred's stock sale, the small investor 144's and the Rose Glen Private Placement. I am sure you have been right many times in your career of debunking phony BB companies, but I think you are way off base here, Auric. Maybe you would be better off tailoring your arguments to fit the facts, instead of tailoring the facts to fit into your theory of how any small cap or BB stock which goes up in price too fast for your taste is automatically a fraud. Sometimes, the little guy does win. Sometimes, the most dangerous competitor is the one you ignore because they are not even on your screen. ATG is quietly going about its business . . . usually, a pump and dump involves "pump" before the dump. Tell me, where exactly is the pump here?
MST |
