Eventual recapitalization means

[Deleted]

Another offering, yes. If so, when and for how much? Mike said recently that he would like 300m get through all this insurance bs, correct. Does that mean we will see an offering of astronomical proportions. And if so, do we wait to buy? Or continue buying like me on weekly basis.

[matt]

Recapitalization is a vague term that can mean several things, but in the end the company needs more money. The money can come from licensing deals, marketing partnerships, or stock dilution but the most controllable and predictable source of funds is a stock sale.

I am sure Mike would love to see an extra $300MM on the balance sheet, but that is not a realistic number for a secondary offering given that the current market cap is also about $300MM. The most any company does under normal circumstances is about 20% (i.e. $60MM) both because of the impact on the current shareholders and a NASDAQ Marketplace Rule that prevents a company from issuing more than 20% at a discount in any six month period without specific shareholder approval. The 20% limit includes any shares issued to Deerfield in lieu of cash or to relax a covenant, so the more likely figure will be around $40MM or less. A lot depends on market conditions and if you can predict those with any precision you should be working on Wall Street.

[Deleted]

Feb 5, 2018 7:45:01 GMT -5 matt said:

Recapitalization is a vague term that can mean several things, but in the end the company needs more money. The money can come from licensing deals, marketing partnerships, or stock dilution but the most controllable and predictable source of funds is a stock sale.

I am sure Mike would love to see an extra $300MM on the balance sheet, but that is not a realistic number for a secondary offering given that the current market cap is also about $300MM. The most any company does under normal circumstances is about 20% (i.e. $60MM) both because of the impact on the current shareholders and a NASDAQ Marketplace Rule that prevents a company from issuing more than 20% at a discount in any six month period without specific shareholder approval. The 20% limit includes any shares issued to Deerfield in lieu of cash or to relax a covenant, so the more likely figure will be around $40MM or less. A lot depends on market conditions and if you can predict those with any precision you should be working on Wall Street.

Thanks for your input. This
would mean the most we would see in terms of dilution would be another raise close to the one in Oct?