What Nearly 2 Billion Fewer Potential Shares Means | MineralRite (RITE)
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MineralRite’s recent deal with a related party means nearly 2 billion fewer potential common shares. That sounds like a lot, so here’s what it actually means for shareholders.
Every time new shares get created, each existing share ends up being a smaller slice of the company. That’s dilution, so fewer potential shares means less potential dilution.
Here’s where the number comes from. If every Series NMC warrant had been exercised with no buyback, there would be 13.8 million Series NMC preferred shares. MineralRite bought back about 3.9 million of them, so about 9.9 million are expected to remain.
Each of those preferred shares can convert into 500 common shares, so about 3.9 million fewer of them means about 2.0 billion fewer potential common shares, assuming they’d be converted rather than bought back later under the sinking fund. MineralRite says that difference is particularly significant to its common shareholders. Full details, including risk factors, are in the company’s October 2 press release and its Form 8-K filed with the SEC.
https://www.youtube.com/shorts/o_FdZtY_myU
MineralRite’s recent deal with a related party means nearly 2 billion fewer potential common shares. That sounds like a lot, so here’s what it actually means for shareholders.
Every time new shares get created, each existing share ends up being a smaller slice of the company. That’s dilution, so fewer potential shares means less potential dilution.
Here’s where the number comes from. If every Series NMC warrant had been exercised with no buyback, there would be 13.8 million Series NMC preferred shares. MineralRite bought back about 3.9 million of them, so about 9.9 million are expected to remain.
Each of those preferred shares can convert into 500 common shares, so about 3.9 million fewer of them means about 2.0 billion fewer potential common shares, assuming they’d be converted rather than bought back later under the sinking fund. MineralRite says that difference is particularly significant to its common shareholders. Full details, including risk factors, are in the company’s October 2 press release and its Form 8-K filed with the SEC.
