DEBENTURE CONVERSION RATE APPEARS TO BE IN ERROR....DEBENTURE CONVERSION IS IN ERROR
On May 13, 2022, EMBR Capital LLC (the "Acquiror") ........converted $175,000 previously held debentures (the "Debentures") into 7,000,000 subordinate voting shares of the Corporation at a price of $0.025 per share (the "Subordinate Voting Shares")
https://finance.yahoo.com/news/news-release-early-warning-report-234200614.html
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Per note 11on Sedar, conversion rate is 5 cents per share and not 2.5 cents plus total shares to convert were 3,500,000 shares for a $ 175,000 debt and not 7,000,000 shares
11. CONVERTIBLE NOTE On October 23, 2019, Poda issued convertible debenture for gross proceeds of up to $550,000. The debenture bears interest at 12% and is secured against the personal property of Poda. In the event that Poda earns a profit during any fiscal quarter, the debenture holders shall have the option to require Poda to prepay a portion of the principal amount and accrued interest amount and in an amount equal to up to 20% of the amount of profit for such quarter. At any time prior to the maturity date of the convertible debenture, the debenture holders have the option to convert any portion of the outstanding principal amount and accrued interest amount at the lower conversion rate of: i) 1 common share of Poda for $0.05 of the principal amount plus accrued interest amount remaining due or ii) 20% discount to the price per share for the most recent financing. On the maturity date, the balance of the principal amount shall automatically be converted into shares of Poda at the lower conversion rate of i) 1 common share of Poda for $0.05 of the principal amount remaining due or ii) 20% discount to the most recent financing prior to the maturity date. The debenture matures thirty-six (36) months from the date of closing of the financing on October 23, 2019 and is payable on demand after maturity. On March 30, 2021, Poda completed an assignment agreement (Note 8) with the Company. Interest expense of $53,163 (2020 - $50,324) was expensed to the Consolidated Statements of Comprehensive Loss during the period ended November, 2021. As at November 30, 2021, the Company had received an aggregate principal amount of $550,000 (2020 - $550,000) and converted $200,000 of the balance to Common Shares (Note 9), leaving an outstanding principal balance of $350,000
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EMBR Capital Inc. was owed $ 175,000 in debentures, they chose to receive shares instead.
They received 7,000,000 shares at 2.5 cents each for $ 175,000. I do not remember and other financing from them that would justify a 20% discount.
I calculated per note 11, they were allowed 3,500,000 shares at 5 cents each for $ 175,000.
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This share conversion makes a difference to shareholders because a lower share amount given to them means more money to shareholder base.
With 7,000,000 shares EMBR Capital gets 40 cents per share as a payout or $ 2,8 million, which still does not explain all of the unaccounted cash in Poda, which is +/- $ 30 million.
Per note 11, only 3,500,000 shares were to have been granted at 5 cents each and, then their 40 cents payout would amount to $ 1,4 million not $ 2,8 million: the other $ 1.4 million would go to shareholder base.
We need the regulators to look at these transactions.
Here is the contact number of the CSE EXCHANGE: 416-572-2000
PROTECT YOUR RIGHTS.
My personal opinion,