7digital Share Discussion Threads

[alamaison5] 09/1/2019 09:52

monte-0000.1:
It's already surprising that you know how to write, never the less you can read too, lol.
Back to your cupboard donkey...

[monte1] 09/1/2019 09:42

One can do no more than lead an avatar to water.

Please do your own research.

[saul goodman] 09/1/2019 09:35

Dear, oh dear.

[alamaison5] 09/1/2019 09:30

montesurmabite:

I hope you are learning something, lol.

The outstanding loan is POTENTIALLY then convertible into shares in lieu of cash redemption at certain times prior to settlement date (which, IF CONVERSION DID TAKE PLACE, would result in further dilution for EXISTING holders NOT PART OF THE CONVERTIBLE LOAN NOTES). The lenders are NOT going to be mightily hacked off that conversion will take place at a multiple of 3X current price - BECAUSE THEY SIMPLY WOULD NOT CONVERT AT THAT PRICE, CHOOSING INSTEAD TO ACCEPT THE AGREED INTEREST AND REDEMPTION OF PRINCIPAL AT MATURITY - A DATE WHICH MAY OR MAY NOT BE RENEGOTIATED).

[monte1] 09/1/2019 08:32

Good morning all and thank you kcr69 for your brevity. All very interesting, however something of a digression. The rather basic point that I was attempting to make if I may be so bold, albeit obviously not clearly enough, was that the avatar alamaison5 appeared to be labouring under the misapprehension (indeed considered in his investment appraisal) that Juke had been allotted 58m shares under the funding agreement that they had very recently sold and the proceeds of that transaction would revert to 7DIG. I was merely pointing out that was patently incorrect.
There is a facility to convert the loan which would theoretically provide an element of protection to the lender if the funds are not available to repay the debt (high risk given the history of this shower)and assuming the company continues to trade. Indeed if the share price was to rise above the strike price (subject to terms) this would constitute a gain to the lender. The current value of this ‘protection217; currently however is barely 1/3rd of the value at finalisation of the loan agreement.

However, whether they convert or don’t convert - and under what terms, is neither here nor there.

The relevant facts imco;

3 months ago 7DIG tapped up lenders for £1m,revised very quickly to £1.5m, to cover the short term costs of restructuring. This loan has clearly not fully served its purpose as they now have close to 0.5m of debt immediately payable to HMRC that they, at the time of RNS, have no means to pay. Further, their major customer is now undertaking a review of their future relationship which casts material uncertainty over the way ahead.

As I have said before, I can have whatever ‘agenda’ you want me to have on a freebb. You go ahead and fillyerboots if your view indicates something different to mine.



aimho.

[saul goodman] 09/1/2019 08:08

Good morning all.

[kcr69] 08/1/2019 22:23

Wow monte1, you've been let loose on your own this evening. Its late so I will be (relatively) brief. Surprisingly I have to agree with the first two sentences of your post #4342. Thereafter I am afraid it is pure agenda, and all credit to you, no attempt whatsoever to hide it.

Lets re-write your last two sentences to something closer to the truth (Additions in capital letters).

The outstanding loan is POTENTIALLY then convertible into shares in lieu of cash redemption at certain times prior to settlement date (which, IF CONVERSION DID TAKE PLACE, would result in further dilution for EXISTING holders NOT PART OF THE CONVERTIBLE LOAN NOTES). The lenders are NOT going to be mightily hacked off that conversion will take place at a multiple of 3X current price - BECAUSE THEY SIMPLY WOULD NOT CONVERT AT THAT PRICE, CHOOSING INSTEAD TO ACCEPT THE AGREED INTEREST AND REDEMPTION OF PRINCIPAL AT MATURITY - A DATE WHICH MAY OR MAY NOT BE RENEGOTIATED).

I am a little surprised that you genuinely believe (or is it all part of the ruse) that debt lenders would happily give up senior status (fundamental in times of administration) to be forced into owning common shares at a time of loss of capital.

In the simplest terms, while clauses are likely to be in existence where the borrower can force the lender to convert, it most definitely will not be at a price that is higher than the prevailing share price when the prevailing share price is below the agreed strike price. e.g. if the prevailing share price is less than the agreed minimum strike price of 2.58p, there is absolutely no logical benefit to convert - outside of a fundamental belief in the long term future of the business on the part of the debt holder. Clauses that are likely to exist will be more akin to the borrower being able to force the lender to convert if the share price is at an agreed premium to the strike price (e.g. 25% - 30%) for a number of consecutive days.

Of course, if you wish to share the exact debt finance agreement relating to this transaction that demonstrates your points, then I would be delighted to read it. It would clearly be one of the worst examples of debt financing any lender has ever undertaken in recent history....

The whole point of convertible debt is you notionally take a lower level of interest to potentially be a part of capital growth - it is most definitely not that you take a lower level of interest and give up senior creditor status to become a common share holder at a point in time where your capital would be eroded.

Tricky subject Convertible Debt particularly when RNS are often written to appease the masses.

And......please don't tell me that the RNS doesn't state that conversion doesn't have to take place....the RNS doesn't state many things that will be part of a private debt finance agreement.

[alamaison5] 08/1/2019 22:08

I have 1.09p target for now.
I am definitely not a greedy man, lol.
The rumour is that they will fork out the bill them self...
:-)

[barnetpeter] 08/1/2019 22:05

Either way they need to pay the cash next week. They cannot trade with a winding up order passed so will be suspended if they can’t cough up. In fact delisting might not be a bad thing for the company now.. no chance of raising more money and would save a lot of costs. Anything here is possible including your 30 per cent rally

[alamaison5] 08/1/2019 21:39

Are the conversion price set as per unit (share price?). My guess is that the total amount of new shares was set, yes. But at what price?
It's not obvious. I'd say ambiguous. The calculation was made at over 2p. But was the share price itself set in black and white? Nope. Therefore, 58m shares at .75p is now about £435,000.
Also, if the deal, for these 58M share was agreed and signed for wouldn't these 3 parties not obliged to comply and convert at that price of 2p+? If this is the case we should see a nice rise from there.
All up in the air for me...

[monte1] 08/1/2019 20:01

Hmmm.

Think that you might have got the wrong end of the stick there. 7dig have already received, and presumably spent, the proceeds of the loan - hence their inability to settle HMRC liability. The outstanding loan is then convertible into shares in lieu of cash redemption at certain times prior to settlement date (which would result in futher dilution for holders). The lenders are going to be mightily hacked off that conversion will take place at a multiple of 3X current price.

[alamaison5] 08/1/2019 18:54

monte1:



So, 58,000,000 shares at, let's say .075p is £435,000

Just enough to cover the bill.
I did simplify earlier, sorry. And I still do now because only half of it (£750,000) is coming from JUKE, lol.
But the money should be in by Friday at the latest.
If so, JUKE still holds the 48M but I have no idea what are the terms & conditions of their holding...

[monte1] 08/1/2019 17:35

alamaison5

Can you run these figures and logic re Juke past us again?

tia

[alamaison5] 08/1/2019 17:10

I guess JUKE has sold the 58m share that it was holding and that 7DIG has withdrawn the £1.5m.

Everything should be in order by the end of this week.

If everything goes accordingly, it never does (lol), 7DIG should see a nice 30% rise on any of the above news.

I am in for the ride!

Buying 272,603 7DIGITAL GROUP PLC ORD GBP0.01 (7DIG)
Status:Executed
Placed at:16:24:26 08/01/19
Price:£0.0073

[saul goodman] 08/1/2019 16:11

Isn't it all a bit late now?

[ochs] 08/1/2019 15:52

Plus he's been very well paid for making a pigs ear of it. I've held this for just over 2 years in my SIPP (and supported each fund raise). I think Cole's already been given far too long and too much benefit of the doubt.

[barnetpeter] 08/1/2019 14:22

36p to 0.7. Trouble is people like Cole tend to be convinced they are doing a great job.

[ochs] 08/1/2019 13:19

Well after the latest embarrassment/disaster surely it is time to get CEO Simon Cole out? He's presided over shareholder value destruction for many years now, and I doubt he holds many shares himself.

This should be a British success story in a fast growing area, but is instead a total mess at present. Cole out!

[saul goodman] 08/1/2019 12:49

Pleased to hear it, officiallyrob.

[kcr69] 08/1/2019 12:33

It will take me most of the day to get over how impressed I was by the quality of your post #4329 against normal expectations and contributions. Keep up the good work.

[officiallyrob] 08/1/2019 12:19

Not me Saul, I'm feeling particularly moist today.

[saul goodman] 08/1/2019 11:28

Avatars keeping their powder dryer today, I note.