RE:RE:RE:RE:RE:Cytodyn -financingEverytime I revisit the OO the worst it looks,,,,Awful timing ,terrible terms ,unimaginative , permanent long term damage to long term shareholders ,,,
Wino115 wrote: Hire their CFO, he understands a fleece ;)
palinc2000 wrote: They did the deal with only ONE instutition,,,,,,,,,,The deal is definitely much better for CYDY and shareholdsc in spite of the high interest rate than TH s deal ,,,....which cost tens of millions to sharehoders due to dilution amd which will cost possibly tens of millions with the exercise of the warrants
SPCEO1 wrote: That is a really ugly interest rate on that CYDY convert but given the crazy high strike price, I think you could argue it was a better deal than the OO.
The Odious Offering was a historically bad deal. I have been at the investing game for 42 years and it was certainly one of the worst i have ever seen. One aspect of the deal that was a head scratcher was the warrants not coming due until after the convertible comes due. If you were going to offer such outlandishly attractive terms on the warrant, why not then have it come due before the convertible in case you need the extra money.to pay off the convert? I think Palin may have pointed this out previously, but it is just another boneheaded aspect of the OO. That being said, if I understand it correctly, the warrants do not trade so you can only access the cash tied up in the warrant by exercising them. So, my guess is that each quarter going forward (2Q21 and onward), we may see some small amount of them convert as the only way someone can get actual money out of the warrant is to exercise them and then sell the shares. While institutional investors in the deal will likely be holding onto those warrants until maturity, retail investors may just want to turn them into cash sooner rather than later as they likely are not fully aware of what they own and they probably will not like something sitting on their account statement without ever moving higher (I assume they would be priced at zero on customer statements since there is no trading in them). So, I would not be surprised if they picked up small amounts of new equity capital most quarters as some warrants convert into equity just to be able to get at the cash tied up in them.
Given all the hiring they are doing, they may need the extra cash!
Wino115 wrote: I looked at your link just to see what amazingly high interest rate they paid. I was surprised to see whomever the buyer is only gets 10% interest! Money's cheap these days I guess.... and with a strike price massively out of the money (3x of current price) at a level the share's never seen! Cheap money indeed.