WTMHouston: Re:"Before you accuse me of this you should read the contracts a bit more closely"
I did not intend to accuse you of anything. However, you made several errors, and each error was presented as a negative refelction on the company. Additionally, each of your posts had a decidedly negative tenor about it. Please understand that the longs on this board have had to endure our share of people posting negative information whose agendas were certainly not related to information gathering or DD. There is a cadre of posters whose lifelong ambition, it seems, is to post as much negative information, misinformation, disinformation and blatant lies, about this company as they possibly can.
There certainly are negatives associated with this company, and there certainly are risks associated with investing in it. No one will deny that. As a possible investor, you must consider the negatives as well as the positives. However, in none of your posts have you made any references to *any* positives. When we see that, we tend to suspect the motives of the poster. Although your motives may be completely honorable, we are jaded. That is, of course, unfortunate. If I have misinterpreted your motives, I sincerely apologize. You will have become the one single exception to the trend that we have become accustomed to.
On a related note, I would like to ask why, if you truly are a potential investor, have you not asked any questions about the potential upside of NVEI?
I am getting long-winded. Sorry. On to more technical matters. I have to say that I am now unsure about when the convertible notes could be converted. You said:
The Notes expressly provide that they are convertible "at any time." The conversion option applies to "unpaid Principal and unpaid Note Obligation" and not to only that which has become payable or due.
The language is, on the face of it, contradictory. However, let's look at the whole statement:
CONVERSION OPTION. This Note shall be convertible at the
option of Payee or other holder hereof (the "OPTIONAL CONVERSION"), at any time, in whole or in part, in lieu of and in satisfaction of the unpaid Principal and unpaid Note Obligation hereunder.
Please note the part that says in lieu of and in satisfaction of the unpaid Principal and unpaid Note Obligation hereunder. The Principal and Note Obligation cannot be satisfied until they are payable, in my opinion. It would seem ludicrous to allow an obligation to be satisfied before it becomes an obligation. I am frankly stumped. You may be right, but I am not yet convinced. It would not make sense to write a note that does not become payable until a certain requirement has been met, only to allow the note to be converted into stock, priced at a value close to the currently traded value at the time of the writing, becore the "payable" requirement has been met. I cannot believe that was the intention, and not being a contract lawyer, I am unsure now what exactly the contract says.
However, even if the notes are convertible now, and assuming that they are not restricted (I still am unsure about that), it is a pretty fair bet that they have been converted and sold. What does that really mean, then. Well, it means dilution of a little over 2 million shares. Not great, but it gets a debt off of the books. Additionally, NVEI is still entitled to the first $2.25 million of the movie receipts. That will then be much-needed money in the bank.
Edit Note: It looks like JH answered the question about recovery of production expenses and whether the converted shares are restricted.
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