Hemp Inc (HEMP)

[Det_Robert_Thorne]

I have a theory about the interest payments

I just now returned home, and will need to look into this more, but I think that the $10M+ in stock-based interest has to do with loan or interest payments made a year, or more, ago with Pref and Pref K shares.

Since the repayments are made with Pref and Pref K at discount to the commons, when they're converted into common shares the company has to take a charge for the difference.

Suppose that in Oct, 2015, when HEMP was at about $0.05/share, it cleared $1M of debt by issuing 20M Pref K at $0.05 each.

Then, in 1Q/17, the holder of those Pref K demands that they be converted into common shares at 10 for 1. HEMP has to issue 200M shares now worth about $0.03, which costs the company $6M worth of common shares. Subtract the $1M paid out a year ago, and the difference is a $5M hit to the expense line.

Of course, who received $5M of HEMP common stock in echange for a $1M loan (or $1M of interest).

I'll give you one guess, and it rhymes with Loose Berlopin.