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TOPIC: Franshei's Lincoln Park Capital comments

Franshei's Lincoln Park Capital comments 14 Jul 2017 04:59 #9569

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Thinking this morning on some of you comments franshei.
I dont remember LPC having the freedom on deciding if the scleroderma results met their criteria or not in having the option in buying Cytori shares other then they must be above $0.50.

You mentioned two points yesterday.
Buying below $1.47
LPC reviewing the results to decide if they would invest.

I don't remember either of these in the deal filing.
Is my memory off ?
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Franshei's Lincoln Park Capital comments 14 Jul 2017 05:48 #9570

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myownhedgefund wrote: Thinking this morning on some of you comments franshei.
I dont remember LPC having the freedom on deciding if the scleroderma results met their criteria or not in having the option in buying Cytori shares other then they must be above $0.50.

You mentioned two points yesterday.
Buying below $1.47
LPC reviewing the results to decide if they would invest.

I don't remember either of these in the deal filing.
Is my memory off ?


LPC has no freedom at all- Cytori determines when and at what price LPC can buy shares from them.

SAN DIEGO, Dec. 29, 2016 (GLOBE NEWSWIRE) -- Cytori Therapeutics, Inc. (NASDAQ:CYTX) (“Cytori” or the “Company”), announced today that it has entered into a common stock purchase agreement and registration rights agreement (together, the “Agreements”) with Lincoln Park Capital Fund, LLC (“LPC”), a Chicago-based institutional investor and existing stockholder in the Company. According to the terms of the Agreements and subject to a registration statement being filed and declared effective, Cytori will have the right at its sole discretion to sell to LPC up to $20.0 million worth of shares over a 30-month period. Cytori will control the timing of any future investment and LPC will be obligated to make purchases in accordance with the Agreements . Cytori expects to use the proceeds for working capital and general corporate purposes.


“We anticipate that the forthcoming new year will bring a number of important milestones for Cytori,” said Marc H. Hedrick, M.D., Cytori’s President and CEO. “This $20 million financing facility will help provide additional financial flexibility to Cytori in its efforts to move forward with these key milestones for its stockholders.”

There are no upper limits to the price LPC may pay to purchase common stock from the Company and the purchase price of the shares will be based on the prevailing market prices of the Company’s shares at the time of each sale to LPC. No warrants, derivatives, financial or business covenants are associated with the Agreements and LPC has agreed not to cause or engage in any manner whatsoever, any direct or indirect short selling or hedging of shares of the Company’s common stock. In consideration for entering into the Agreements and committing to fund up to $20.0 million, Cytori has issued shares of common stock to LPC as a commitment fee and will issue additional shares of common stock on a pro-rata basis only when and if shares are sold to LPC. The Agreements may be terminated by the Company at any time, at its sole discretion, without any additional cost or penalty.

A more detailed description of the Agreements is set forth in Cytori’s Current Report on Form 8-K as filed with the SEC which the Company encourages be reviewed carefully.

This press release does not constitute an offer to sell or a solicitation of an offer to buy these securities, nor will there be any sale of these securities in any jurisdiction in which such offer solicitation or sale are unlawful prior to registration or qualification under securities laws of any such jurisdiction.


The 20 Mio limit has to do with the Nasdaq regulations on what a listed Company can raise during anyone year when the market cap is below 75 Mio$- I assume that will not be the case any longer next year.

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Board moderator and Site-owner. I still regret the day I started analysing the prospects of MacroPore (now Cytori) back in 2004- a left-over from the tech-bubble at that time from the century change in my portfolio- and became addicted to Cytori´s fat cell technology. :cry:

Franshei's Lincoln Park Capital comments 14 Jul 2017 07:19 #9572

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Probably my memories are off.

But, the 1.47 number comes from one of the company filings for the LP deal (at the time the CYTX stock price was around 1.55/1.56 and I believe the 1.47 number appears in one of the "company papers".

At the time, I thought that LP would start investing in CYTX, while the company had paid the upfront money (in terms of shares - of which, they have sold). Yet, there has no LP stock purchase to date. In Hedrick's CC, he mentions that LP agreement calls for 30 installment stock purchases, after the STAR data readout.( LP has their own consultants to go over data.) There has been various conversations here and there (including comments from Rodney Strongg and others) that the LP funding can be avoided, if there is a partnership comes in time. Yet no partnership came in March and early April, while there was a sudden reduction in the stock option reduction granted to the senior management earlier.

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Franshei's Lincoln Park Capital comments 14 Jul 2017 07:39 #9574

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I believe the LPC stock purchase agreement was put into place just in case Cytori cannot find a partner for nano-particle (~$5 million upfront) or Scleroderma in the EU+ (~$30 million upfront). Cytori's cash position would prevent them from negotiating anything better than these high end numbers. My guess is Cytori will get small partnerships and will utilize LPC and the ATM to be able to launch their US Scleroderma commercialization in late 2018.

After the data is known, we can have some fun projecting the number of patients to be treated in the first full year. This is where the numbers could be surprising. Everything takes money.

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Franshei's Lincoln Park Capital comments 14 Jul 2017 08:12 #9575

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This could be my misunderstanding in reading the Dec 30, 2016 SEC filing re LP deal. I am not a financial expert.

At the time, the stock price was 1.36 (on the filing for Dec. 28).

The maximum aggregate offering price for 6,509,677 shares is 1.445.

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Franshei's Lincoln Park Capital comments 14 Jul 2017 13:30 #9578

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DOV wrote: I believe the LPC stock purchase agreement was put into place just in case Cytori cannot find a partner for nano-particle (~$5 million upfront) or Scleroderma in the EU+ (~$30 million upfront). Cytori's cash position would prevent them from negotiating anything better than these high end numbers. My guess is Cytori will get small partnerships and will utilize LPC and the ATM to be able to launch their US Scleroderma commercialization in late 2018.


DOV- my guess would more be that a European Habeo deal will be closed with a bigger upfront (despite the desperate cash position of Cytori)

Reason why?

All auto-immune disorders like Lupus, Sjogren´s, scleroderma etc etc have in common that its patients have elevated levels of T-cells in their bloodstream (also NK- (natural killer) cells. These T-cells are thought to cause damage to the endothelial (vascular) system and its patients ensuing endothelial dysfunction. Just like with atherosclerosis this tend to happen first in the extremities i.e. hands and feet- the disorders just get different names.
To me- ADRCs with its T-regs (IP licensed from Thomas Ichim) are perfect to achieve an improved homeostasis in these tissues with the rest of the mix doing the rest to restore vascular function.

I am still amazed by 90% improvement in SLERADEC I on Raynaud´s - thats the big thing.

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Board moderator and Site-owner. I still regret the day I started analysing the prospects of MacroPore (now Cytori) back in 2004- a left-over from the tech-bubble at that time from the century change in my portfolio- and became addicted to Cytori´s fat cell technology. :cry:
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