Labor Smart Inc (LTNC)

[DD2Gain]

It is caustic financing because it is convertible.

The conversions have been brutal this year and this new loan promises more dilution: Caustic.

However, you are correct in that it is 11% annual interest. But, not entirely correct...

The Debentures bear interest at the rate of 11% per year (half of which is guaranteed, and in addition to the original issue discount)

Half of 11 is 5.5% guaranteed return. Still a phenomenal arrangement for only 7 months of investment. And what of the guaranteed original issue discount?

As for the "floor" pps being .15:

the conversion price will be adjusted to a variable price equal to the lower of $0.15 or 60% of the lowest volume weighted average price of the common stock for the 20 prior trading days

There is no floor. If this loan converts as millions of dollars has with this company thus far it will drive the pps down, down, down: caustic.