Progressive Care Inc (RXMD)

[Stcgg]

First off, you're not getting $2,205,000 just $2,000,000 (8 tranches of $250k each). Then there is a 10% OID that CVP gets for interest ($200,000 in shares.. further dilution), along with the attorney fee for $5,000.

The increase in shares takes off roughly 22% from the share price adding say 73,500,000 shs to their current 339,545,107 o/s.

Since there is no certainty that the share price will rise, CVP shorts the shares for profit banking on the effects of dilution and shareholder sales due to losses, as well as other shorts taking advantage of the floorless convertible to profit by shorting.

In the end, CVP can recover all its funds by shorting to zero, and this has happened more often with these convertibles than not.