The company is offering up to $25 million in convertible preferred stock and warrants to purchase shares of common stock. BNVI stated the completion of the offering was critical for the continued operation of the company throughout 2012.
While this step may in some ways hurt shareholders of common stock, the financial reports of the company suggest it is needed. BNVI plans to use the proceeds to, among other things, finance the Phase 3 clinical trial for its drug candidate, Menerba.
Yesterday's market performance of BNVI suggests shareholders are on board with the idea so far. It will be interesting to see whether support will hold today.