it makes for good reading

It makes for good reading

A company with $ 190 million in accumulated losses cast about for a life preserver and at a board meeting in November 2018 decided marijuana was the future until it wasn’t.

In the meantime back at the courthouse plaintiffs were lined up to complain about matters from stuffing distribution channels and lying about it to a woman who lost a leg and wanted either her leg back or 1 million plus legal fees. 

The class-action suit about lying settled for 2 million to be paid by the insurer who was preoccupied with claims not to pay the claims while the lady continues to chase her leg through the courts in Travis County, Texas.

Not to be left out are a stiffed telemarketer, a foreign collaborator (1.5 mm), a victim of IP theft (930,000), an upset wrongfully terminated executive (200,000), and a California whistleblower in search of a bonus.

While defending legal matters with claims in excess of three years worth of revenue (losses ranging from $3-$10 million the last two years) management found time to locate and negotiate a licensing agreement with an outfit ten thousand miles away for a pandemic vaccine in the window from when Wuhan entered the lexicon to 23 March 2020 (guessing weeks).

Casting about for the next big thing created the amoeba-like construct of the acquisition of an intermediary company that in turn would license the science on generous terms from the foreign company. The shareholders of the, in the most polite way possible, cutout, included the underwriter of the coming public offering based on the license, the licensor of the science, and apparently the CEO of another publicly listed company using his personal email address. The cutout agreed to receive cash, shares, and other payments conditioned on future public offerings and science milestones that had some passing connection to the pandemic.

And the CEO of the licensor of the science generously participated in a conference call one week before the public offering to make promises of purpose so that money would be exchanged for shares and warrants bound for investors from Florida to Lichtenstein. Yes, that Lichtenstein, without an airport or army of its own, which tickled the social interest by renting itself, the entire country, out to contemporary musician for $70,000 a night in 2010.

The trading period around the offering was worth the price of admission. A stock that traded by appointment saw over 50 million shares exchanged in two days or roughly twenty-five times the amount outstanding. Price doubled but has since returned to pre offering levels. Volume has been sucked back like vapor trails under the door of a fire that promises blowback. 

It is not clear from filings whether the cutout received 19.9% of the pre-offering shares outstanding because the required filings have not been made as of 29 April, though the company website is very helpful in all other matters in this regard.

The rest of the play is for the discerning audience to inquire.