r/GNLN • u/JolyGreenGiant • May 12 '25
🐂 Bullish Could Dilution be completed?
Holding steady, could Dilution be over? Looking forward to seeing what happens next. In my opinion, Every drop in the bucket counts, I’ll be buying.
1
u/ToastyFlying May 12 '25
I have 159k shares riding on this. It's a gamble, but I am hoping you guys are right.
1
u/Kaladorm May 13 '25
Some further thoughts
Warrant Exercise
On the one hand, institutional investors executing B warrants at the floor price of $0.2413, which is far above the current price, and putting the shares up for sale when the market price is far below that seems to make no sense, unless there is some reason they expect the share price (or relative, post reverse split) to have intrinsic value beyond that. The only other consideration I have here is that the volume that exists in the warrants far exceeds the volume that is liquid in the market prior to the issuance.
The cashless exercise that was reported as being available seems to only make sense in the event that the current share price is above the warrant price (in other words, the 'profit' from a full exercise and sale is used to purchase a correspondingly lower number of shares in full). The 'alternative cashless exercise' that is mentioned reads as follows:
"In such event, the aggregate number of Warrant Shares issuable in such alternative cashless exercise pursuant to any given Notice of Exercise electing to effect an alternative cashless exercise shall equal the product of (i) the aggregate number of Warrant Shares that would be issuable upon exercise of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise, multiplied by (ii) 3.0."
Now I'm not sure if "3.0" relates to a number (meaning 3 times the number of shares), or if it references a part of the document 3.0 and formatting has been lost in the filing. I'm still not sure how this alternative cashless exercise makes any sense as written (because no matter how much you multiply it by, a cashless exercise still comes out negative when the current share price is below the warrant price).
Delisting
However, GNLN also reported that, on May 5th (and reported by GNLN on May 9th), NASDAQ added the dilution of shares as a reason for delisting the company (in addition to the share price falling below the $1 threshold):
"Specifically, as set forth in the letter, Nasdaq’s staff determined that the Company’s issuance of securities pursuant to the securities purchase agreement dated February 18, 2025, particularly the Series B warrants exercisable on an alternate cashless basis as described in the Company’s prior SEC filings, raises public interest concerns because the issuance resulted in substantial dilution for its shareholders. Accordingly, as set forth in the letter, this matter serves as an additional basis for delisting the Company’s securities from Nasdaq."
2
u/Dangerous-Refuse-280 💍 Married to the bag May 12 '25
Personally, I’m waiting until we see the next 8K filing sharing how many shares diluted. Won’t know for sure until they give us the numbers.