MultiCorp International Inc (MCIC)

[emulwa]

Mugsy5. Assume you had 10million shares. The company would issue you convertible debentures, meaning that they would be converted back to common stock after certain conditions are met. The company would give you debenture certificates and takes away your shares which they would then retire in order to reduce the outstanding shares (O/S). With fewer O/S the stock would move easily because valuation of EPS is the earnings divided by the O/S. You would later convert your certificates back to common stock after a few years at a favorable rate.
Here is an example of what happened with PAIM
If I have 50 Million shares bought at .0001. The company is saying they are taking 45 Million out of my account and giving me an IOU for $45,000 which after 5 years I get to keep but I lose my debenture shares. So after 5 years, I am left with 5 Million shares and 45,000. Anytime before the 5 years is up, I can turn my debenture shares into free trading shares for a cost of .01 cents a share, but I can only do this for 10% of my debenture shares. So if I choose to turn my debenture into free trading shares I am left with 5 Million shares from my original purchase and 4.5 Million shares from the debenture, but it cost me $45,000 to convert them. So I will be left with 9.5 Million shares and out $45,000. The company is in effect paying $45,000 for 45 Million shares, they could buy on the open market right now for $4,500.00. They are paying 10 times what they are worth. Same case would be for SMMW if they chose the same terms.