would be nice if this reverse split was only a method to circumvent Nasdaq rules. Take the chance on the R/S knowing we'll lose 20-50% of the share price. The upside, we make 10 consecutive days. Then BARDA and/or Scleroderma partner comes and we can split back.
Otherwise, as Clowncircus noted on yahoo, Hedrick's financial reality may end up being:
Burn $5m per quarter
*Debt $17m (covenant requires 3 months for debt service) to avoid breach of covanents
A/P $6.3m (management gold ring pay checks)
Interest on Debt $3.7m
Olympus (JV) $1.7m
CRO’s $2.5m ($ 3m balance due)
Roche $1.0m (rest due 1H 2016)
That's nearly $20m in short term obligations. Plus the operational burn of $5m this quarter. They are out of or nearly out of cash. I expect Hedrick the brilliant will implement the following this quarter:
- Implement Massive RIF ( from 77 current employees too 22-24.) Hedrick looses his pa. HR looses the expensive VP and Hedrick employees an HR manager. IP counsel goes away. GC picks up her duties. Legal looses assistants. Regulatory looses managers actually doing all of the filings and Kleinhenz is left to do them on his own. Kleinhenz leaves because he doesn't work anyway and can easily find another gravy train for $300k +. Development team gets iced completely. Next gen product shelved. Tiago looses 3 more and he must pick up the rest on his own.
- Board takes options in lieu of fees because they have no choice.
- Management forced to take 50% cash reduction in salaries.
- Lorem Vascular relationship stalled with no projected revenue contribution in FY16. May move to a legal fight costing CYTX thousands in legal fees they don't have.
- Need to shelve some of the trials due to cost containment and cash conservation.
- Possible wild card consideration of a take private on the backs of the longs post rs.
Reads just like KOOL. Interesting parallels except the overpaid executives bit. At least at KOOL, the Chairman is actually running the company without an overpaid manager and for a couple hundred grand.
It would be a nice thought to get my shares back and watch the pps drive on partnership. But I'm emotionally winded.