RE:RE:HOW MANY TIMES WILL WE RS? Claritas Facebook
Just seeing if anybody is interested in taking part in a convertible debenture.
The way it works is say you own a hundred thousand shares worth 13 cents ($13,000)
You sell your shares and take the cash to buy into the debenture. Once you do the company will provide you with either a principal interest on your $13,000 of say 15% ($1,950) or a discount on the shares you will receive at the end (6 months)
Depending on how it is agreed on (as it can go a few ways but here is a typical agreement) you have loaned the company $13,000 and immediately received $1,900 tacked onto your total owed to you ($14,950) which will be paid out in 6 months to you.
At the end of six months, if you do not wish to take the cash and instead with to convert, the conversion rate will be somewhere around todays share price of 13 cents with each share being accompanied by a warrant good for two years with an exercise price of slightly above todays share price (14 – 18 cents)
So, on conversion one can expect to receive 115,000 shares and 115,000 warrants at or around todays share price of 13 cents even if the going share price at time of conversion is $1 -$10.
If the share price goes down, you take the money and earn the interest. If the share price goes up, you are making money. In all, it is less riskier than owning the shares which can fluctuate down or up as you have locked in a pretty low price in a stock which should move upwards fairly high rather quickly.