After reading through the last threads and seeing that apart from the usual "Happy-Clappers" many Newbies view this newest Capital raising as something positive, lets just stick with the facts for a moment and come back to some sorts of reality:
ADO wasn't able to secure the financing from the Canadian Investor. We don't know what happened, but most likely he judged the future prospectives as "too much wishful thinking" and thus jumped ship.
Of course ADO-Mangement tried to sell this differently to investors (everything is fine, this is the best possible outcome for us) but was that really the case ? IMO many unanswered questions remained...
Well as it turned out, just a few weeks later, this interpretation is finally admitted to be wrong, as the next desperate Capital Raising takes place. This time, the "institutional investor" (in reality read as a shylock or money lender) gets some deal which guarantees more than a 30% interest rate. Wow-What a deal !
This deal is not !!! something positive for ADO (and thus their shareholders)
Even Twinvest (probably the most "Happy-Clapper) had to admit that the financing was done for some 25 % interest rate (paid directly and up front)
Well, to be honest, that is just about half of the truth!
This 25% interest-rate-calculation is completely ignoring the 92% conversion rate of the convertible note (add 8%), as well as the 9.8 Mio options for 8.9 cents. (add amount xxx, if the options are exercised in the money)
So in a worst case scenario for ADO-shareholders (meaning the shareprice will never ever surpass the 8.9 cents again-and thus the options expire worthless), ADO will pay an interest rate of about 33 % (25% paid upfront plus the 8% from the conversion rate)
In case, the share price is indeed able to get above 8.9 cents, this interest rate becomes even higher.
So just let this information sink in, for a second.
What company, which is convinced that that their product (in this case Mix&Go) will become a success ! is financing a bridge loan north of 33% ???
Sorry but by all industry standards and especially by common sense, this reeks of pure desperation. Nobody in their right mind would finance for such an interest rate, if they expected their product to become a bestseller.
So don't let yourself be fooled, this is indeed a shitty deal for every shareholder. Especially when you realize that the option to get another 4.5 Mio USD (after the initial 2.0 Mio USD) needs approval from both parties.
Meaning (as i read it) the shylock (or credit shark, as we call them where i live) can always refuse to pay this additional amount money, or renegotiate the terms according to his wishes. Neither of this scenarios is favorable for ADO-shareholders.
So, in summary:
This is some shitty deal for ADO-shareholders, everybody who tries to tell you otherwise is ignoring the facts.
If you are still not sure, what to make out of the given facts, just ask yourself this simple question:
Would a company, that is convinced to have a bestseller-product, really finance a bridge loan north of 30% ??? (when according to their last quarterly, they had millions in the bank and are expecting rising revenues and margins)
Well, i don't think so and common sense should tell you the same.
Greetings Wantedman
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