![](http://investorshub.advfn.com/images/default_ih_profile2_4848.jpg?cb=0)
Tuesday, April 24, 2012 2:52:33 PM
The alternative that YA elects would be based on how much money was offered for the patents. For example, if it was $49.7 million or less, YA would not convert anything and would take 100% of the selling price, leaving nothing for the common stockholders. In that scenario, NEOM would have no further business and the common stock would have a value of zero.
An example where YA would convert to 7 billion shares would be if a sale of the patents was for $100 million. In this case, YA is better off by converting to common stock where it would then own 87.5% of the common stock and its share of the $100 million would be $87.5 million. In this scenario, the $12.5 million for common stockholders that own the 1 billion currently outstanding shares would be worth about $.0125 per share ($12.5 million divided by 1 billion shares). So my conclusion is that in a $100 million sale of the patents the stock is currently over valued.
I am using the above values as a simplified illustration of how I believe YA would react under those two patent valuation scenarios. It is hard for me to believe that the patents would command a price anywhere near $50 million when revenues are declining quarter over quarter and gross profit was negative for Q4. However, I think the take away is that to justify the current stock price for a long term holder, the patents would ultimately need to be worth more than $100 million. And that is a price that even some doctors may flinch at!
FEATURED Cannabix Technologies and Omega Laboratories Inc. Provide Positive Developments on Marijuana Breathalyzer Testing • Jul 11, 2024 8:21 AM
ECGI Holdings Enhances Board with Artificial Intelligence (AI) Expert Ahead of Allon Apparel Launch • ECGI • Jul 10, 2024 8:30 AM
Avant Technologies to Meet Unmet Needs in AI Industry While Addressing Sustainability Concerns • AVAI • Jul 10, 2024 8:00 AM
Panther Minerals Inc. Launches Investor Connect AI Chatbot for Enhanced Investor Engagement and Lead Generation • PURR • Jul 9, 2024 9:00 AM
Glidelogic Corp. Becomes TikTok Shop Partner, Opening a New Chapter in E-commerce Services • GDLG • Jul 5, 2024 7:09 AM
Freedom Holdings Corporate Update; Announces Management Has Signed Letter of Intent • FHLD • Jul 3, 2024 9:00 AM