@GravityWaves I think thinkinloudly was just basing that on 10% interest and principal repayment on 9million face value assuming it will not be converted to equity and be a pure debt instrument only. The face value is only 8.25million if converted to shares within a suitable short term time period (6 months or 12 months) as this is treated as a repayment from my understanding of how these convertible notes work. (i.e conversion date is a repayment therefore qualifies for discount to face value)
Therefore it would make sense that with the first tranche 7.5million not subject to MC hurdle that Lind convert as much of this to equity whilst SP is low. My feeling is that any upside now will be limited to the date that conversion will become eligible as this will mean Lind get more shares as its on a weighted average volume basis over a set time. Possibly 14 trading days or a month?? (Its in the agreement just too late at night to review it).
May explain the silly sales suddenly coming in closing auction today to stop this rising 10% today and instead end up 6.25%. If the sell pressure was not there would have easily finished 10% higher today. Again I don't believe retail will be placing sells in the closing for 2pips less than what demand was willing to pay and there was good demand today at closing.
My feeling is Lind will convert asap and hope that BLK turn things around in March quarter and sell out on the news pocketing not only the 750k fee for the 1st tranche funding but also any upside in SP. They have then reduced exposure completely with a big windfall.
Conversation to shares is a risk but at these prices far less risky than say if Dec was a good quarter and SP continued north per date eligible to convert as the weighted price would be slot higher and therefore reduce issued shares received for funds advanced.
just my take.
BLK Price at posting:
3.4¢ Sentiment: Hold Disclosure: Held
