OTCPK:JENGQ - Post by User
Comment by
HermannHalleron Aug 28, 2020 10:03am
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Post# 31469106
RE:RE:RE:RE:JE Q1 results!!!
RE:RE:RE:RE:JE Q1 results!!!Your math is correct, but not your logic. Yes the new shares are being issued at $0.10. But that doesn't mean that is where they will trade in the future. They are no longer being offered at that price.
It's a bit like an IPO. A company might go public at say $10, and then the stock trades at $17 on the first day. Someone might say, Why is it trading at $17 when they just issued shares at $10? Obviously shares can trade in the market at multiple times the issue price.
Remember in this case, the company had to incentivize the lenders to backstop the equity issue. They did that by providing them an extremely low price on their new shares.