Ann: Bass completes $2m Convertible Note issue for Graphmada, page-18

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Anacott Steel

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04/07/17

17:13

Post #: 25661169
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Originally posted by DoctorFouad ↑

The good news is that they found financing at last moment and didnt go bankrupt (and didnt give up the mine for pennies a la stratmin), the bad news is that as I expected (see my latest posts) its a convertible debenture financing (instead of a simple loan) which means more dilution. Convertible loans (2 million$) end up always converted to shares, by 30 november 2017, (1.5 cents per share) + the 12% annual interest will also be converted to shares (dont know how many years are they gonna calculate the interest, for sure at least 1 year) + 1 option for each 2 shares.

Quote :

"Additionally, each note holder shall receive 1 listed option (with an exercise price of 2.5c and expiry date of 31 December 2018) for each 2 shares that they will receive at the conversion date (30 November 2017)."

'"Interest is payable at 12% per annum on the Convertible Notes and interest will accrue and also be converted to securities on the conversion date."

Which translates to :
2 million $ at 1.5c per share = 134 Million additional Shares
+ 67 Million Options.
+ 240.000$ (12% interest calculated for 1 year) at 1.5c per share = 16 Million additional Shares.
+ 8 Million options (for the converted interest).

Total of dilution : 225 Million fully diluted shares

The register is now 1.37 Billion shares + 471 Million options = 1.84 Billion fully diluted shares

+ The new dilution we will end up by 30 november 2017 at 2.07 Billion fully dilute shares !

Or : 1.52 Billion Shares + 546 Million Options !!!

Welcome to the Dilution World !

However this is not the all dilution we will get !!! surprise surprise !!! if you read carefully :

Quote :
"the Notes will convert at the lower of 1.5 cents per share or the price at which the Company concludes a capital raising . "

This means that the company intends raise additional capital through a cap raise by 30 november 2017 !!!

How much ? IMO at least another 2 Million$ at 1.5c !!!

Assuming for simplification that the new cap raise will also include 1 free option for each 2 shares, and repeating the 12% interest for simplicity (and not wasting time repeating the previous calculations) then double again the additional dilution (from 225 fully diluted shares to 450 Million fully diluted shares)

In other words, we will most probably end up by 30 november 2017 at a register of AT LEAST 2.3 Billion fully diluted shares, or 1.67 Billion shares and 621 Million Options !!!

At least 22% additional dilution by 30 november 2017

And all this, because of 3-4 months delay in refurbishing the mine.....

if your head is not spinning already, it should....

Sigh...

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Consolidation in the pipe line one would think? 5-1

Last edited by Anacott Steel: 04/07/17

BSM Price at posting: 1.0¢ Sentiment: Buy Disclosure: Held
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Ann: Bass completes $2m Convertible Note issue for Graphmada, page-18

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