Ann: Appendix 3B - Part Conversion of Convertible Security, page-24

First 24 Last

Share
Profile

Follow
Scoobysnacks

1,178 Posts.

343

04/07/17

20:43

Post #: 25664883
Share

Originally posted by RobbieinAus ↑

Hey Scooby,

So the CN holder needs to sell at approximately 72% of the conversion price (ie. a 28% buffer below the conversion price). 72% is break even, above that is "profit", below that and they are losing money on lending. This is true no matter what the conversion price is.

Keep in mind -- this "profit" that everyone is all up in arms about - is essentially interest on loaned funds plus the 10% discount on the note.

So for example, they converted at 1.9c in the last batch. That means they need to sell at above 72% of 1.9 to walk away with more money than they loaned- or they need to sell at 1.4c or above.

Also keep in mind - the conversion price is set at 20% above the average 2 day vwap in the preceding 5 days. So theoretically, in a flat market, - they have already started eating into this 28% buffer thanks to the conversion premium.

I'm not sure if the $350k cap has hurt us more - they are still always confined to the 72% of conversion price floor. So perhaps if there is enough demand above the 72% floor - they could have unloaded more in bigger batches. This would have accelerated the pay down process rather than the wound followed by a slow retail bleed. But if the demand isn't as plentiful - they'd likely stage it out in chunks in order to let the demand refill like they're doing anyways.

I'm inclined to agree with you though - I think it probalby has hurt us more in the end. In times of high demand - they could have just gotten this over and done with. Instead we have a big CN selldown usually creating 5-15% hit to the SP, then trailing retail sales over the following weeks, coupled with reluctance for new investors to enter with CN hanging to slowly bleed us to death.

Expand

Thanks for breaking that down. Exactly what I was getting at though. They need to let them convert the whole amount and avoid the retail sell down in between conversion periods. This doesn't need to drag on for another 2 months

XPE Price at posting: 1.5¢ Sentiment: Buy Disclosure: Held
3 Upvote

0 Great analysis

Reply

Top Stories

HCH

Hot Chili sets up water company as drought racks Chile–but must also build communities a desal plant

PMT

High-grade lithium zone extended at Patriot's Corvette project, drilling grades at 5%

WCN

White Cliff gears up to explore expanded Nunavut Cu-Ag-Au project in Canada

RXM

Rex Minerals soars 60% on $390M Indonesian buyout deal from MACH Australia

CXO

Core Lithium narrowly beats guidance on FY24 spodumene production but 1Y returns still shattered

There are more pages in this discussion • 7 more messages in this thread...

First 24 Last

Add OAK (ASX) to my watchlist

(20min delay)
Last 6.9¢		Change -0.001(1.43%)		Mkt cap ! $1.889M

Open	High	Low	Value	Volume
7.0¢	7.0¢	6.9¢	$1.415K	20.34K

Buyers (Bids)

No.	Vol.	Price($)
1	91146	6.9¢

Sellers (Offers)

Price($)	Vol.	No.
8.5¢	182500	1

View Market Depth

No.	Vol.	Price($)
1	91146	0.069
3	15100	0.063
2	180000	0.060
1	86000	0.058
1	53000	0.056

Price($)	Vol.	No.
0.085	182500	1
0.089	200	1
0.090	150	1
0.095	1524	1
0.096	52424	1

Last trade - 15.31pm 08/07/2024 (20 minute delay)

OAK (ASX) Chart

Ann: Appendix 3B - Part Conversion of Convertible Security, page-24

Hot Chili sets up water company as drought racks Chile–but must also build communities a desal plant

High-grade lithium zone extended at Patriot's Corvette project, drilling grades at 5%

White Cliff gears up to explore expanded Nunavut Cu-Ag-Au project in Canada

Rex Minerals soars 60% on $390M Indonesian buyout deal from MACH Australia

Core Lithium narrowly beats guidance on FY24 spodumene production but 1Y returns still shattered

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News

Ann: Appendix 3B - Part Conversion of Convertible Security, page-24

Top Stories

Hot Chili sets up water company as drought racks Chile–but must also build communities a desal plant

High-grade lithium zone extended at Patriot's Corvette project, drilling grades at 5%

White Cliff gears up to explore expanded Nunavut Cu-Ag-Au project in Canada

Rex Minerals soars 60% on $390M Indonesian buyout deal from MACH Australia

Core Lithium narrowly beats guidance on FY24 spodumene production but 1Y returns still shattered

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News