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Post by newmnkdinvestor on Jul 29, 2015 12:20:48 GMT -5
KC- Are you suggesting MNKD and GSCO are now working together? GSCO down graded twice and valued at $2. What else do they need to say at this point.
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Post by tbone on Jul 29, 2015 12:24:21 GMT -5
You may need a new calculator. 4.85 is 94.5% of 5.13. MNKD didn't even get close to trading there yesterday, let alone that being the VWAP. I did say it's a rough approximation. $4.75, $4.85, $4.95, is 10 cents, 20 cents, or whatever worth quibbling about? Actually it is so convoluted that it takes reading a few times. While original "floor price" will be 94.5% of VWAP for yesterday (call that 4.58 if the VWAP yesterday were about 4.85). THEN for the convert price each day you take GREATER of 95.75% of VWAP for the day (so far today let's be generous and say .9575 of 4.50 = 4.31) or 95.75% of "floor price". That would be .9575 of 4.58, or 4.39. So, based on today's action we convert a couple million dollars worth at 4.39 or maybe we don't convert any because it's so ugly. Any other opinions? |
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Post by compound26 on Jul 29, 2015 12:24:29 GMT -5
baba, I also don't like what Matt said. Technically speaking, he did not say that there was absolutely no dilution whatsoever, though he kind of incinuated that there will not be dilution. I do not like that sneaky way, and in hindsight he knew what he was talking about, because these type of deals do not happen overnight. His credibility is questionable. Could he be "trading" MNKD? I agree with what bretzyboy said above: "Figured this news would light the fires on both sides of the fence. As for the side I'm on, I'm glad the debt issue is settled, Matt P. did not mislead in anyway. It's still about the product and the market it will reach. This day will mean very little if at all six months after the relabeling." I do not think Matt is in anyway misleading. Even if he knew what he is going to do back in June, what can say? He has to somehow answer the questions regarding no dilution without giving out too much details about his plans. As some of our friends have posted, he did give some clue as to what he might be doing. It is easy to blame Matt for what he has said or done or question him why he hasn't done x or y. However, at the current stage, I do not think Matt has a lot of options to choose from in the first place. So what Matt has done is essentially removed $57 million debt for a minimum dilution (which by the way does not add to short-able shares). It should have minimum impact in PPS if the shorts have not taken advantage of the news to drive down the PPS. Things haven't changed much other than a $57 million debt swap for a minimum dilution (which by the way does not add to short-able shares). It is still about the product. We've got a winning product. The key lies in how to transform the winning product into a blockbuster. |
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Post by compound26 on Jul 29, 2015 12:29:56 GMT -5
I did say it's a rough approximation. $4.75, $4.85, $4.95, is 10 cents, 20 cents, or whatever worth quibbling about? Actually it is so convoluted that it takes reading a few times. While original "floor price" will be 94.5% of VWAP for yesterday (call that 4.58 if the VWAP yesterday were about 4.85). THEN for the convert price each day you take GREATER of 95.75% of VWAP for the day (so far today let's be generous and say .9575 of 4.50 = 4.31) or 95.75% of "floor price". That would be .9575 of 4.58, or 4.39. So, based on today's action we convert a couple million dollars worth at 4.39 or maybe we don't convert any because it's so ugly. Any other opinions? tbone, I agree with your reading. I think the noteholders have the option to covert as long as the actual share price of the day is greater than the floor price. If it is not the case, the noteholders have the option to not convert. In other words, if they think the floor price is too high (compared with the actual share price), they can choose not to convert. "The holders will not be obligated to complete any stock-for-notes exchange for any date on which the daily VWAP is below the floor price then in effect." Anyway, it is convoluted language. Also, it appears right now the market (and the shorts) is attempting to drive down the share price to be around 95.75% of "floor price" (which you calculated to be around .9575 of 4.58, or 4.39). So if no major news regarding MNKD or Afrezza comes out from SNY tomorrow, the market (and the shorts) will probably peg the share price to this level for the next 10 trading days or so. What this means is that $57 million debt will be swapped for 12-13 million of shares (instead of 9 million of shares we originally have anticipated). So we have about 1% dilution that we have not priced in previously (but fully priced in at today's PPS). That is fine. And the low PPS is only a temporary issue. The big picture is still how well will Afrezza perform over the time. |
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Post by orlon on Jul 29, 2015 12:57:48 GMT -5
MNKD has given itself 3 years to resolve this issue once and for all. At that time they will have more than enough cash assets to eliminate this debt. Why are you guys unhappy ? They bought time to resolve this at a future point of being flush with cash. It's good news indeed. Unhappy? The share price is down another 8% today. Another three years? Are you kidding me? In my opinion this is not good news, it is simply delaying the inevitable...buyout for a song or bankruptcy. Look at the over picture for the past seven years, the company fought for and won approval for AFREZZA, early adopters are loving it, they partnered with SNY then they started going downhill....scripts are low, DTC ineffective, marketing sucks. I wonder how many margin calls have been the last couple of days. |
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Post by joeypotsandpans on Jul 29, 2015 13:06:17 GMT -5
MNKD has given itself 3 years to resolve this issue once and for all. At that time they will have more than enough cash assets to eliminate this debt. Why are you guys unhappy ? They bought time to resolve this at a future point of being flush with cash. It's good news indeed. Unhappy? The share price is down another 8% today. Another three years? Are you kidding me? In my opinion this is not good news, it is simply delaying the inevitable...buyout for a song or bankruptcy. Look at the over picture for the past seven years, the company fought for and won approval for AFREZZA, early adopters are loving it, they partnered with SNY then they started going downhill....scripts are low, DTC ineffective, marketing sucks. I wonder how many margin calls have been the last couple of days. Guess you missed this earlier in the thread, and if people are on margin then they need to accept the consequences of their actions, same for those that buy options...both are nothing "short" of gambling  : You can end the "pain and suffering" at any time...there are buyers out there that want/NEED approx 112mill sh. Read more: mnkd.proboards.com/thread/3100/mannkind-announces-stock-exchange-agreements?page=6#ixzz3hIxU4Ywu |
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Post by babaoriley on Jul 29, 2015 13:06:47 GMT -5
Some very good posts on this subject; dudley's above is especially good, thanks dudley! Yes, there was always going to be dilution, but Matt and others were hopeful that the exchange price for the debt would have been at least around $6, instead of where it is. Also, there's that provision in the news release that allows MNKD to change the floor price on a day to day basis over the ten day period. So, if conversion isn't happening because the price is too low, it seems MNKD can either pay off the debt with cash or allow for a lower floor price. I think I have a bit less of a problem with Matt's recent claims.
To me, the interesting thing will be whether this stock can be (will be) manipulated above or below $4.39, which was my estimate of the floor price in my earlier, still sleepy-headed post. I believe the next ten trading days will be trench warfare - keep low and keep that helmet fastened tightly.
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Post by dudley on Jul 29, 2015 13:12:10 GMT -5
It's hard to envision any sort of true "death spiral" battle materializing. The price here has to be very tempting to real investors with longer term horizons and there are only 12-13 million shares in play from the convert. That's barely 2 days of average volume. My guess is smart money grabs bargain shares to offset shorting efforts trying to eke out a few more shares. Any knowledgeable investor can see this deal is much more favorable than unfavorable, resolving a large part of the puzzle quite satisfactorily and the remainder is basically the same as it always was at a much smaller level. If there are positive indicators from SNY and MNKD quarterly results/calls this will all be forgotten in a heartbeat. Long term it will be just another footnote in the story - which as many others have pointed out is all about the results and market penetration over time. I personally bought another few K shares this morning, just adding some sprinkles to the top of my sundae.
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Post by newmnkdinvestor on Jul 29, 2015 13:35:30 GMT -5
MNKD has given itself 3 years to resolve this issue once and for all. At that time they will have more than enough cash assets to eliminate this debt. Why are you guys unhappy ? They bought time to resolve this at a future point of being flush with cash. It's good news indeed. Unhappy? The share price is down another 8% today. Another three years? Are you kidding me? In my opinion this is not good news, it is simply delaying the inevitable...buyout for a song or bankruptcy. Look at the over picture for the past seven years, the company fought for and won approval for AFREZZA, early adopters are loving it, they partnered with SNY then they started going downhill....scripts are low, DTC ineffective, marketing sucks. I wonder how many margin calls have been the last couple of days. i am about 9 months in on the trading/investing game and you have to be a fool if you are buying this stock on margin. |
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Post by newmnkdinvestor on Jul 29, 2015 13:42:44 GMT -5
Unhappy? The share price is down another 8% today. Another three years? Are you kidding me? In my opinion this is not good news, it is simply delaying the inevitable...buyout for a song or bankruptcy. Look at the over picture for the past seven years, the company fought for and won approval for AFREZZA, early adopters are loving it, they partnered with SNY then they started going downhill....scripts are low, DTC ineffective, marketing sucks. I wonder how many margin calls have been the last couple of days. Guess you missed this earlier in the thread, and if people are on margin then they need to accept the consequences of their actions, same for those that buy options...both are nothing "short" of gambling : You can end the "pain and suffering" at any time...there are buyers out there that want/NEED approx 112mill sh. Read more: mnkd.proboards.com/thread/3100/mannkind-announces-stock-exchange-agreements?page=6#ixzz3hIxU4YwuI disagree that margin is used to gamble only. On this stock its crazy but not true for other stocks. Apple closed on 7/8 at 120. Anyone who watches apple knows that was a day to buy on the dip. I rode that for a week and made 8%. |
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Post by obamayoumama on Jul 29, 2015 13:58:43 GMT -5
Unhappy? The share price is down another 8% today. Another three years? Are you kidding me? In my opinion this is not good news, it is simply delaying the inevitable...buyout for a song or bankruptcy. Look at the over picture for the past seven years, the company fought for and won approval for AFREZZA, early adopters are loving it, they partnered with SNY then they started going downhill....scripts are low, DTC ineffective, marketing sucks. I wonder how many margin calls have been the last couple of days. i am about 9 months in on the trading/investing game and you have to be a fool if you are buying this stock on margin. Look like the average price yesterday was about $4.86 which gets you to a lowest average price that the converts will get at about $4.60. AF article on a "Death spiral" is another headline with no truth about it. The 9 millions shares will need to be returned. The rest is noise. Remember tomorrow we will get SNY's report. Analyst are expecting 1.7 million in sales and Symphony has the Q2 numbers at about 2.5 million. Unless Symphony has over estimated sales we should have beat tomorrow. If it is a big beat on numbers then the average price on the converts could be higher than the low water number of $4.60 |
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Post by kc on Jul 29, 2015 14:06:16 GMT -5
After Matt presented to GS back on June 10th, 2015 you have not heard a word out of them. Why? They couldn't speak as they were probably hired to help sell the package to private holders. Have you heard a word from them since that date?
6/10/15
8:40 AM PT Goldman Sachs 36th Annual Global Healthcare Conference
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Post by tigiron on Jul 29, 2015 14:07:21 GMT -5
All have to do is keep pps above $10 until Aug. 11- only 5.5m dilution. If shorts keep stock at $2 for more then 10 days, 23m. Something to fight over. So AF was correct about debt and dilution? Say it ain't so Matt, say it ain't so... There is a floor of around $4.85 on the conversion price. Please read the press release more carefully. Where or how did you get the number of 4.85? |
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Post by obamayoumama on Jul 29, 2015 14:18:28 GMT -5
There is a floor of around $4.85 on the conversion price. Please read the press release more carefully. Where or how did you get the number of 4.85? The floor is about $4.60 based on the 95% of the VWAP from yesterday. |
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Post by dudley on Jul 29, 2015 14:25:53 GMT -5
Here is what I gleaned from the official 8-K on the exchange notes. It is not clear how the VWAP is calculated so I am using just the closing price as examples. Furthermore it is not clear what happens if the holders do NOT complete the exchange since they "have the option but not the obligation to exchange" if the daily VWAP is lower than the floor price on that date. I assume they would WANT to exchange since the lower the price the greater number of shares they receive but again it is not clear.
"Pursuant to the Stock-for-Note Exchange Agreements, the exchange transactions will generally be priced over a 10 trading day period spanning from July 29, 2015 to and including August 11, 2015 (each, an "Exchange Date"). The number of Exchange Shares related to each Exchange Date will equal approximately 1/10th of the total principal amount of the 2015 notes to be exchanged, divided by the exchange price for such date. The exchange price for each such date will be the greater of 95.75% of the daily volume-weighted average price ("VWAP") of the Company's common stock for such date and 95.75% of a floor price, which floor price will initially be 94.5% of the daily VWAP on July 28, 2015, but may be adjusted by the Company for any trading day by providing notice to the holders prior to 9:00 a.m. Eastern Time on such day. On any Exchange Date on which the daily VWAP is lower than the floor price in effect on such date, each holder will have the option, but not the obligation, to complete the portion of the exchange associated with such date. In the event the Company modifies the initial floor price for any trading day during the exchange period, the Company will promptly publish the modified floor price on the Investor Relations page of its corporate website (http://investors.mannkindcorp.com/index.cfm). Information contained in the Company's website does not constitute a part of this report."
Today's floor price as well as all subsequent days unless the company changes it ( which floor price will initially be 94.5% of the daily VWAP on July 28, 2015) is therefore 94.5% of yesterday's price of $4.82 or $4.555
Exchange price today will be the greater of 95.75%, of that floor price, or $4.36. OR 95.75% of today's VWAP. Assuming the stock closes at $4.45 that would be $4.26 so the exchange price would be $4.36 since it is the greater of the two. Since today's VWAP is less than the floor it is not clear if they will convert or not since they have the option but not the obligation to convert. My guess is they WILL convert since I still think they have already shorted with the expectation of using conversion shares to cover.
This would be the same scenario for all the next 9 trading days as well, unless they change the floor price. So unless some other event occurs (like a horrible conference call - we will certainly hope the opposite is true - GREAT conference calls) to massacre the price further it appears the exchange will hover somewhere in the $4.36 range. 56.9 million in principal will be just over 13 million shares issued.
Still somewhat murky overall but hopefully all of it actually gets converted and we get this behind us.
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