RE:RE:RE:RE:RE:RE:RE:RE:GRENVILLE STRATEGIC ROYALTY ANNOUNCES 2017 SECOND QUARTER Yes, maybe they go with another, smaller debenture and a share offering.
Sometimes, debentures can be extended, but the company almost always pays a sweetener (cash and/or a lower convertible price) plus a higher rate for the extended period.
For example, let's say GRC muddles through another two years, making a minimal profit each quarter with no writedowns. They would probably be hard-pressed to pay off the debentures in Dec 2019. At that time they could offer the debenture holders 9% for another year, 1% cash on acceptance and a reduction in the conversion price to 15 cents per share. Assuming the debentures are eventually converted into shares, the current shareholders would be severely diluted, but the company would still be a going concern, living to fight another day, and keeping management in their cushy jobs.
Anyone interested in the debentures should check out the original prospectus - some debentures allow the company to redeem with shares (at a discount to market, but good luck selling at your issue price).
I think the debs are too risky, even for me, because I don't have any faith in the management (luckily I never owned shares).
Based on the amount of royalties that were received in Q2 2016 but not received in Q2 2017, it looks like at least one third of the investment dollars were poor choices; and now the royalty income barely exceeds management salaries and expenses.
Time to turf the management.
The only royalty company that I would invest in is Alaris (almost 8% yield); and, yes, they have had some warts as well. However, their management is lean, honest, straight shooting and competent.