ok, Charles, here is the answer for the "death-spiral convertibles" that i posted over on the yahoo board..............
>>>>KRAN recently issued $700,000 of these issues
than can be converted at 70% of market price regardless
of how low the market price goes.<<<<<
Not so........
this latest issue of convertibles have a minimum convertable price of $1.40; which is 70% of the market value ($2.00) when they were issued....if the stock price goes lower, then it's not likely they will be exercised...... if the stock goes higher, and this was the reason and the incentive for buyers to take this issue, then the convert price moves up in tandem; that being 70% of the current market price..... i fail to see the reasoning for the holders to want a lower stock price; they always have a 30% vig to work with...... and i can assure you that my math indicates that 30% of $5.00 is more than 30% of $2.00..... investors putting money into turn-around situations need some incentive for the risk exposure; this is just one way that the company choose to do that.
KRAN is slowly putting its distribution business back into place.
what were their revenues for 1997??..about $5 million....they might do over 2.5 million this Q and as their business continues growing again could be doing $5 million a Q by year-end.
they have grossed $240,000 this year from their 3 HSN shows...that's 120,000 cigars @ $2.00 net (jan: 20,000; feb: 40,000; mar: 60,000) this is a nice piece of business, but not the whole issue we are dealing with. also, KRAN is negotiating to distribute cigars to several nationwide chains; that's thousands of potential retail outlets.....cigars could become 15 - 20 % of annual revenues....so, there's lots of other items and categories they have.....
jl
p.s.......Krantor is getting back into the HBA distribution business (Health & Beauty Aids.)....this will be another layer of revenues that will start to add up........ |
