Asberry 22 Holdings Inc (ASHI)

[bernardsamuel]

I see that there's a new 8K available for viewing in springboard fashion from this website. I'm not sure that I'm as analytically literate as I was pre-retirement, but let me take a shot at describing what I see in the 8K...

First, it's not good news that there wasn't a simple statement that the 81K in Iliad debt had been paid off, especially as we've seen pieces of good PR from VHUB about how quickly new products are selling.

Second, the increasing toxicity of the convertible debt is really beating down on the company now. Here's the conversion formula, abstracted from the 8K:
As used herein, “Conversion Price” means a price per share equal to 70% of the average of the three lowest closing bid prices of the Company’s common stock in the twenty trading days immediately preceding the applicable conversion.

It's not good that it's the closing bid prices, rather than just the closing prices, of the stock that are the centerpiece of the formula. So, just rounding off a bit and making some guesses, if you've got an average closing-bid price of, say, .003 at some point in time, then 70% of that will be .0021. So how many shares do you get when you divide, say, $80,000 in debt by $.002 per share in conversion rate (forgive me for being so lazy by rounding off): 40,000,000 shares.

So that's a matter of increasing the issued shares by something like 50%. BUT, there's a provision in the documents that prohibits conversion if it will take Iliad to owning 10% or more of the issued stock.

So frankly I just don't know what happens next, and maybe one of you guys can figure it out. Strangely enough, as has been noted in a prior set of conversations on this discussion board, it wouldn't be the worst thing in the world if the company became debt-free at the "cost" of its issued shares increasing by even something like 400,000,000 shares, presuming that the company will actually become profitable if there's no interest to be paid. Getting back to RPH's comment awhile ago, modified by Gustavo's comment, if this company is just plain viable at let's say $10 million of annual sales volume, the stock's got to be worth more than it's selling for these days.

Wishing all a good weekend...