Here is what a reverse split would look like if it had happened today.
.0068 * 100 = New pps of .68 cents
2.4 billion shares /100 = 24 million O/S THE A/S REMAINS @ 5 BILLION
125 look back period low Sept 14th .004
YA Globals, conversion rate is 85%(average of various instruments)of lowest closing bid. Therefore, .004 * .85 = .0034 or .34 cents when factoring R/S * 100.
Par value .001 * 100 = .10 cents
YA Global stands to make 100% on conversions as opposed to the paltry 10% they have been stuck at with the whole .01 par value issue.
Now, if the pps drops so does YA's conversion rate - all the way down to .10 PAR VALUE! Therefore, the churn stops at PAR VALUE once again. Anything above 10 cents and YA is profitable. Especially, if they are somehow shorting the stock simultaneously.
Now, if a sell was to occur the lowest closing bid becomes majorly important as that becomes YA's full conversion of outstanding debt to common rate.
Hypothetical scenario using .34 40mil or so outstanding / .34 = 117,647,058 in actual shares to YA Global = the 24 mil O/S = 141,647,058 O/S
Now take a sell price of say 250mil / by the O/S = $1.76 per share
Shareholders get 24mil * 1.76 = $42,240,000
YA Global gets 117,647,058 * 1.76 = $207,058,822.08
Now, the lower the conversion rate the more YA stands to get.
Say, the pps tanks further to .003 giving YA a .0025 or .255 conversion rate.
40 mil / .255 = 156,862,745 shares to YA
Same sell price of 250mil now divided by 180,862,745 O/S = $1.38 per share
Shareholders 24mil * 1.38 = $33,120,000
YA gets 156,862,745 * 1.38 = $216,470,588.00
Do you see how the math works in their favor? The lower the pps the higher their return - Simple...
Now as evidenced by many here the only way one can keep up with r/s is too keep on buying - increasing ones risk just to stay in the game and that also serves YA's churn rate of returm until they are good and ready to release news - since the contracts mandate Neom can't say a thing until YA approves.
The major upside of Neom is gone IMO especially considering I didn't even factor in YA's warrants of say 1.4 billion reduced by 100 = 140,000,000 more potential shares added to the O/S before the division of any sell proceeds (not much of a factor IMO unless the pps sky rockets - then they would get the common shareholder in that way...
The good news is those holding shares with a .011 - .012 cost avg should see an opportunity to escape, being that YA holds converted shares in that range. IMO, if the pps doesn't reach above .01 before the R/S. YA Global, is definitely shorting or in some other form hedging their bet and all I could then say is GOOD LUCK! Keep an eye out for the lowest closing bid - that number as always will be important.
AI
