Debt transferred to Tilray but financed by KAOSThis company has little options. The market is too smart for the Hexo "Dog and Pony show" only the longs on here are giddy. Just curious where exactly is Hexo going to draw the money from to pay the interest payments of about 12 million a year and the consulting fees if they are losing money/month?
Perhaps the "backstop" KAOS funding up to $180 milion at $C5million per month at a conversion price but given little details we assume that is at market prices. So interesting that Tilray has a conversion at 85 cents but KAOS or Adam Arviv group gets shares at market which would imply they have a vested interest of getting them as low as possible. So the debt restucture has a 5% interest payment to Tilray while the debt is financed by Adam team at market which is still highly dilutive.
Just speculating here but I can see the Adam team shorting this stock while getting $5 million worth of shares at new all-time lowes. In the end the Adam Arviv team and the Montours walk away with a near majority. Unfortunately this situation of dilution works only in the favour of KAOS and to a lesser extent Tilray and the average bag-holder gets stuck with well you know..holding the Bag!