Replies to post #31902 on NanoViricides Inc. (NNVC)

[philsdaddy]

It appears that NNVC gets the money upfront, at the initial closing date. So that's not a bad thing. It also appears to me that this particular financing arrangement will be over in less than six months--60,000 shares every two weeks, with a total of 500,000 shares to be released (these are Preferred (B) shares) would indicated that the shares will have all been released within five months. Whether the financing company is going to be dumping these on the market remains to be seen. I'm not sure of the number of shares of common stock this translates into so I'm not sure what kind of pressure this will put on the share price. Yeah, if I am the financing company it could be in my best interest to keep the share price low so I control more shares, but if the plan was to liquidate the shares as I received them then I would want a strong share price to be maintained, thereby ensuring a steady flow of returning capital. So, this could, in some fashion put a governor on the share price for the next five months, barring developing news, but after that, if the company hadn't sold the shares I would think they would want the share price to go up. Of course, tangible news should trump the finance company's external pressures. So we wait and see. Hopefully we look back a couple of years from now and recognize this was a necessry evil (especially in today's tough economic and financing climate) and we all have profited from our investment and our patience. At least that is my plan.
Lee

[drkazmd65]

I'm not a great finance wizard (science nerd here) but it doesn't look too out of whack to me. The gradual trickle out of shares rather than all at once should muffle a lot of the potential dilution shock.

If the stock share appreciates in a huge way in the very short term (months) the financers will do really well, REALLY well.

However, so will the rest of us.

I've seen worse. I hold stock in a junior solar company that just refinanced old notes (~7% dividend) for new notes with a 2 year extension on terms with a 13% dividend +stock conversion at any point after the first year of term.

Could be better, certianly could be worse terms.