Replies to post #224613 on NorthWest Biotherapeutics Inc (NWBO)

[biosectinvestor]

Yes, part of the settlement, but not exactly for the reasons stated. The massive shorting had broken the clause and made it unsustainable. The NASDAQ rules allowed them to recharacterize it, reasonably so. It had been a favorable financing arrangement premises on a baseline share price range. Shorts broke it, as I’ve seen them do multiple times to other companies as well with that kind of shorting vulnerability. It was a pwrfectly legal and normal transaction and series of transactions, but shorts love to break companies and NASDAQ is not particularly helpful or sympathetic when that happens. It’s a roll of the dice..

[Poor Man -]

Right BearTrap. I didn't word my comment properly. I just meant that NWBO still applied the same method for making payments in shares (plus warrants) in lieu of cash to settle their obligations with Cognate just prior to its sale. Agreed, the MFN non-compliance issue had already been resolved at the insistence of Nasdaq, and would have been moot anyway since the company delisted.

As an aside, the exchange of shares in consideration for services between three related parties that included NWBO, Cognate and Toucan is what likely drew the attention of the SEC, and why they insisted on interviewing parties from all three entities.

Not quite right, Poor Man. MFN status was ended before the Cognate sale and shares returned to NWBO as part of a settlement agreement. This was a positive outcome for longs.
This is from Senti:
Quote:
Apparently Nasdaq did not like certain aspect of the NWBO - Cognate relationship, as they made Cognate return some of the stock they'd received under a "most favored nation" status clause.

I wrote:

Some may recall that payments between NWBO and Cognate were in the form of discounted shares and MFN conditions, which was the genesis of the problems with Nasdaq - those payments in shares continued until shortly before Cognate was sold.