LA to begin with take a real good look here. Mr. Obvious you missed the most important thing we have four(4) accredited investors. This is very positive read this very slowly. Banks will be loaning MMJ businesses money in the very near future as in months. This 850K will allow the company to add (2) two more store openings which will bring the total to (9) nine stores. With new banking loans to be regulated this will give PHOT the opportunity to get a real loan without the shark loans or outlandish conversion rates.
The whole thing sounds like a bad deal but that is only if management does not act after 1 year in which they have the ability to buyback the shares for .03925 a share (850,000 + 425,000 + 59,500)$1,334,500/34,000,000=.03925 In the 1st year the holders would pay.025 and 70% of the average of the lowest pps in a 20 day period for x-amount of days Lets use the example of .10 a share was the lowest average one year from now. The conversion works like this .025+ .07= .095 per share. Thus the conversion shares would come to 850,000/.095=8,947,368 shares. However, in the event they do nothing it would be a catastrophe and thus the 34,000,000 shares. Thus the real dilution would be the 8.94 mil and much lower in the event of a higher price.
The fact that PHOT can strategically place these stores within states that are allowing recreational use will greatly benefit PHOT whereas many "new" users and buyers will grow their own. The sophistication of new models now allows even the amateurs the ability to grow there own for 1/10 the cost. Therein lies a very good reason to be even more bullish than many thought possible. Financing growth at .095 a share plus while the current rate is .06 Naturally this only occurs if the price is at .10 one year from now. Do not see default or bankruptcy in the foreseeable year as even remotely possible in lieu of public support and the current stance by the FED. If my numbers and reasoning seem to be wrong please enlighten me and the board as this is a better buy since the news than before!!
The conversion price for the period of time from the date of these 7% Notes through and including September 30, 2014 is the lesser of (a) $0.025 per share and (b) seventy percent (70%) of the average of the three (3) lowest daily volume weighted average price occurring during the twenty (20) consecutive trading days immediately preceding the applicable conversion date on which the Holders elect to convert all or part of their 7% Notes, subject to adjustment as provided in these 7% Notes. The conversion price is $0.025 per share for the period of October 1, 2014 through the maturity date of September 30, 2015, subject to adjustment as provided in these 7% Notes. The Company is required to reserve, at all times, thirty-four million (34,000,000) shares of its common stock, in the aggregate, for conversion of these 7% Notes. At any time after the 12-month period immediately following the date of these 7% Notes, the Company has the option to pre-pay the entire outstanding principal amount of these 7% Notes by paying to the Holders an amount equal to one hundred and fifty percent (150%) of the principal and interest then outstanding
AI
