US Stem Cell Inc (USRM)

[Dragon Lady]

Asher will go SHORT at some point in the future in my opinion. Anyone who got the "convertible" shares Jan 14, Feb 10 and Feb 19 of 2014 (they are "floorless" with steep discounts and "conversion" provision based on a formula of stock price for X trading days, blah, blah, blah)

When you see that "toxic" type financing- it usually means they are making money on the "up" portion as in the recent run-up, and then, at some point, will most likely go brutally short to make even more money.

Here is from the SEC, they explain these "convertibles" and what can happen.
https://www.sec.gov/answers/convertibles.htm

By contrast, in less conventional convertible security financings, the conversion ratio may be based on fluctuating market prices to determine the number of shares of common stock to be issued on conversion. A market price based conversion formula protects the holders of the convertibles against price declines, while subjecting both the company and the holders of its common stock to certain risks. Because a market price based conversion formula can lead to dramatic stock price reductions and corresponding negative effects on both the company and its shareholders, convertible security financings with market price based conversion ratios have colloquially been called "floorless", "toxic," "death spiral," and "ratchet" convertibles.

Both investors and companies should understand that market price based convertible security deals can affect the company and possibly lower the value of its securities. Here's how these deals tend to work and the risks they pose:

* The company issues convertible securities that allow the holders to convert their securities to common stock at a discount to the market price at the time of conversion. That means that the lower the stock price, the more shares the company must issue on conversion.
* The more shares the company issues on conversion, the greater the dilution to the company's shareholders will be. The company will have more shares outstanding after the conversion, revenues per share will be lower, and individual investors will own proportionally less of the company. While dilution can occur with either fixed or market price based conversion formulas, the risk of potential adverse effects increases with a market price based conversion formula.
* The greater the dilution, the greater the potential that the stock price per share will fall. The more the stock price falls, the greater the number of shares the company may have to issue in future conversions and the harder it might be for the company to obtain other financing.

Here is another quote explaining this type of "financing"- this was put together by someone right here on I-hub and is a good explanation of "death spiral" financing and "convertibles":

http://investorshub.advfn.com/~-ASHER-~-25451/

I would not be surprised, in my opinion, to see at some point- near future, that Asher turns and shorts this hard, like in real hard as we've seen in the past few yrs. Where they can put down pressure that rapidly brought the price down to the 1 penny range and in one spike (don't know if it was them for certain?) to .0063. But in my opinion, they are motivated to go short in the future from everything known about how Asher operates and "does what they do" when they provide this type of convertible share financing with those discounts and "share price conversion" formulas you see listed on page F-41 of 10-K. That's my opinion, I think it can tank hard at some point- with dudes who got way more power to swing the price than any retail Joe Shmoe.