Joe's Jeans Inc. (DFBG)

[ShadowSpy69]

Sounds like dilution to me.....
http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=9405363-513135-527072&type=sect&TabIndex=2&companyid=7853&ppu=%252fdefault.aspx%253fcik%253d844143

http://yahoo.brand.edgar-online.com/displayfilinginfo.aspx?FilingID=9405363-1110-22838&type=sect&TabIndex=2&companyid=7853&ppu=%252fdefault.aspx%253fcik%253d844143

The Company expects the transaction will close on or about August 31, 2013.

The convertible notes, if issued, will be issued with different interest rates to Hudson’s management stockholders and Fireman (and related persons), respectively. Convertible notes, in an aggregate principal amount of approximately $24.1 million, subject to adjustment for the purchase price, to be issued to Hudson’s management stockholders (the “ Management Notes ”) will be structurally and contractually subordinated to the Company’s senior debt, have a term of six years, would accrue cash interest paid quarterly on the outstanding principal amount at an annual rate of 10% per annum, and will be convertible by each of the holders beginning two years after the closing of the Acquisition and ending six years after the closing, into shares of the Company’s common stock, $0.10 par value (“ Common Stock ”) or cash, at the Company’s election. The $10 million, subject to adjustment for the purchase price, in aggregate principal amount of convertible notes to be issued to Fireman (and related persons) (the “ Fireman Notes ,” and together with the Management Notes, the “ Buyer Notes ”) will be structurally and contractually subordinated to Company’s senior debt, have a term of six years, would accrue cash interest paid quarterly on the outstanding principal amount at an annual rate of 6.50% per annum, and will be convertible by the holder beginning one year and one day after the closing of the acquisition and ending six years after the closing, into shares of Common Stock or cash, at the Company’s election.

Each of the Buyer Notes would be convertible, in whole but not in part, at a conversion price of $1.78 per share, subject to certain adjustments that are typical for convertible notes of this type, into approximately 19.1 million shares of Common Stock, subject to receipt of the Company’s stockholder approval to comply with NASD rules, which the Company has agreed to seek after the closing of the Acquisition. The Fireman Notes may be converted at its sole election and the Management Notes may be converted at either a majority of the holders’ election or individually, depending on the holder. The Company will also seek stockholder approval to increase the number of authorized shares, if necessary. The Company contemplates seeking stockholder approval promptly after the closing of the Acquisition. Prior to receipt of such stockholder approval, the conversion rights will be limited to approximately 13.5 million shares of Common Stock.

If the Company elects to pay cash with respect to a conversion of the Buyer Notes, the amount of cash to be paid per share shall equal (a) the number of shares of Common Stock issuable upon such conversion multiplied by (b) the average of the closing prices for the Common Stock over the 20 trading day period immediately preceding the notice of conversion.

The Company will have the right to redeem all or any portion of the principal amount of the Buyer Notes at any time by paying such amount plus the present value of interest that would have accrued thereon through the maturity date at the discounted present value of the interest and upon such redemption the holder would retain the conversion right applicable to the note.

Pursuant to the Registration Rights Agreement, the Company will provide certain demand registration rights to register the shares of Common Stock issuable upon conversion of the Buyer Notes on up to two registration statements on Form S-1 or an unlimited number of registration statements on Form S-3, subject to availability, and will also provide certain piggy back registration rights.