Originally posted by foo ling yu
'you are the constant pessimist'
I would suggest 'realist'
Upon reading deltavee's refresher, it does appear that conversion price is fixed at minimum $3.50 in the absence of a lower priced share issue.
However, the ability to draw on another tranche may have been in jeopardy had the SP continued to decline. Perhaps the funds were accessed now to prevent a hold up or renegotiation in the event that the vwap fell below $3 at the time they may be required.
I'm very optimistic about this companies future, I just won't be the one scratching my head, crying about it and wondering what went wrong if everything doesn't fall into place perfectly in the expected timeframe.
You may be right that the company brought forward the draw down by a month or two. That's just good management.
"I'm very optimistic about this companies future, I just won't be the one scratching my head, crying about it and wondering what went wrong if everything doesn't fall into place perfectly in the expected timeframe."
I share your optimism but I am very happy with the rate of progress. When I first bought at $1 just after the watch was launched, I bought a company with a high level of risk. The ongoing business was solid and was capable of delivering dividends but offered no real growth. The watches offered strong growth but we really couldn't know how well they would sell on line.
Who expected in such a short time frame that JB Hifi would stock the watches nationwide and then just a month or so later that we would go international with Spark NZ (previously Telecom NZ)? Add another four months and we will be selling in the UK. The rate of expansion has been amazing and I have little doubt that even while UK is being launched, plans will be under way for other European countries.
The best part is that the company is already strongly cash flow positive. When they stocked up with over 20,000 units ahead of Christmas and began their big advertising campaign (over $800,000), most of their available cash was needed. Now despite not selling all of their stock yet, their cash is back up to $2.5 mill and that was ahead of the draw down to boost cash for the UK launch. So we have a rapidly expanding tech company in its infancy but one that is already strongly profitable. How often do you see that? In many ways when you look at how far the company has come, this is a much better buy now at $3.15 than it was at $1.
