I understand that a Convertible Debenture is an alternative to banks.
But it is a very bad choice. And there are other sources of credit. I believe that this is a potential company killer.
If they don't borrow any money from the CD then no problem.
But if they do borrow what ever amount they get is translated into common stock at a nice discount to the market price.
Surely, the lender would like to get the best return on their loan. That means getting more shares than less in the conversion process. So they accomplish that by shorting the stock to force the market share price lower. Then when the "conversion" takes place they get a whole bunch more shares than they would have otherwise.
The key issue is the shorting of the stock following the payment of the money and prior to the conversion. Normally, to short a stock you have to "borrow" shares in advance to cover the short. But a working CD serves just as well because shares will be forthcoming soon after the short is put on.
I know I am "preaching to the choir" here. You know very well what king of irreversible damage a Convertible Debenture can bring to a company that does not have the re3sources to defend the stock. Maybe Isodiol will use the $20M to buy back their own shares after they go sub-penny. Anything is possible.
I have been investing almost exclusively in penny stocks since the early 1970's. I have seen a lot of companies destroyed by the "death spiral" of share price that results from a CD. I have learned to avoid CD's like Ebola. I have only been a shareholder here for two weeks. Now that this CD is in place I am looking for a quick exit. There are tons of opportunities in MJ penny stocks that don't have a CD.