Ayala Pharmaceuticals Inc (ADXS)

[foggdogg]

The investor will reap a nice ROI in short order as the debt instruments mature in 6 months. The notes that were issued allow the investor to cash out in 6 months at a 15% rate of return. However, it seems only at a face value of 90% of the million. And then the investor gets 2,500,000 warrants exercisable at .20. So they could reap $500,000 assuming they sell at .20 just from the warrants. I wish I had a million or two to fund them....lol

At $1000 per $850 invested you get 1176 notes with a face of $1000

1176 x 1000 = 1,176,000

90% of the maturity rate is:
1176000 x .9 = 1,058,400

2,500,00 x .20 = $500,000

Plus the $500,000 minimum return for warrants exercised at .20

** My math is adequate at best...lol....But that is the way I read it.

In the financing, senior secured promissory notes (Notes) were issued at an original issue discount of 15% whereby each Note had a $1,000 face value per every $850 invested. All Notes mature on December 31, 2009. If there is a qualified equity financing in place at maturity, the Notes can be converted into the same securities sold in the qualified equity financing at a discounted per share conversion price equal to 90% of the per share purchase price of the securities sold in the qualified equity financing. Warrants were also issued to the Note holders at a rate of 2½ warrants per every US dollar invested and at a strike price of $0.20 per share.