MyEcheck Inc (OTCMKTS:MYEC) Continues to Shrink
After ending last week stuck at $0.034 for two consecutive sessions, MyEcheck Inc (OTCMKTS:MYEC) started this one by obliterating almost 16% of its market price. By the time of yesterday’s closing bell MYEC was down 5.84% on a volume of 9.4 million shares. The stock is currently sitting at $0.029.
The most recent news on the company comes from several press releases issued this past week. The latest one was issued yesterday, and it disclosed that MYEC‘s subsidiary GreenPay LLC has signed an agreement with Maverick Bankcard, Inc. The agreement will allow Maverick to sell GreenPay “products and services”, and will also allow “for co-branding and co-marketing of the MJ-Pay system as MeverickPay”.
We have talked about MYEC‘s MJ-Pay app in many of our articles on the company. The app’s launch was announced on Aug 14 in the Disclosure Statement of the company’s latest quarterly report. The company stated that after its launch in “mid-2014” the app will be available on Android Play and iTunes, but it was nowhere to be found. After over a month of waiting for news on the matter, MYEC finally issued a PR on Sept 22, which announced that the app hadn’t been launched and that the hold-up was due to “a service partner delay”. Now, the app is expected to come out in “January 2015”.
Prior to yesterday’s release, MYEC issued one on Nov 3 and one on Oct 30. Monday’s PR disclosed that the company has four new customers to which it will provide its electronic check services. With the one from Oct 30 the company announced that it had secured a $5 million line of credit from TCA Fund Management Group. The release then states that MYEC will initially draw $550 thousand, will end up paying $60 thousand cash in fees, and will issue nearly 3.8 million shares to TCA. Ed Starrs, the company CEO and President, disclosed that MYEC will be expanding its “business plan with this available capital”.
For the line of credit, “TCA is entitled to $100,000 worth of MyECheck restricted common stock”. These $100 thousand worth of stock amount to 2,941,176 shares. Each share was given a price of $0,034, as that was the closing price on Oct 29 when the deal was struck. What the PR failed to disclose was that the “credit facility is convertible to stock” with a 20% discount of the current price at time of conversion. We found this information in an 8-K report filed on Oct 31.
Combine the news from the 8-K with the discrepancies we found in the Form 10 filed on Oct 27, and it shouldn’t be a mystery why the stock is in the red. Do your own research and take into account all the risks associated with the company before putting any money on the line.
