Nuvo Pharmaceuticals Inc NRIFF

RE:RE:RE:RE:Market Cap - Too Low

[daydream1]

Regardless of the share price Deefield will get its money + interest back. Nuvo has to make mandatory quarterly loan payments equal to the greater of US$2.5 million and 50% of excess cash flow to Deefield to repay the senior secured loan. A higher share price is just gravy for Deefield.


From Nuvo's website
Financing:

Deerfield has provided a binding commitment letter to Nuvo to be the sole financier and to fund the Proposed Transaction in its entirety (the Financing). The commitment letter from Deerfield provides Nuvo with the following:

• US$52.5 million of 6-year term, 3.5% p.a. interest, senior secured convertible debentures with a conversion price of US$2.70 to fund the acquisition of the Canadian operations and working capital purposes;
• US$60 million of 6-year term, 3.5% p.a. interest, senior secured loan for an issue price of US$47.5 million to Nuvo Pharmaceuticals (Ireland) Limited to fund the acquisition of the royalty and product interests in Vimovo, Yosprala and MT400. Nuvo will make mandatory quarterly loan payments equal to the greater of US$2.5 million and 50% of excess cash flow;
• Nuvo will issue to Deerfield, for an aggregate purchase price of US$12.5 million, warrants to purchase approximately 25.6 million common shares at an exercise price of C$3.53 and with a 6-year life (the Warrants). The proceeds from the exercise of Warrants will initially be used to reduce the amount owing on the senior secured loans;
• US$3.0 million of 18-month term, 12.5% p.a. interest, senior secured loan to Nuvo for working capital purposes;
• Deerfield (and any permitted transferee) will be prohibited from converting debentures or exercising warrants if it would result in Deerfield (and its affiliates) holding more than 4.985% of the total issued securities of Nuvo; and
• There will be no changes to the Nuvo senior management team or board of directors.