Provectus Biopharmaceuticals Inc (PVCT)

[buccaneer1961]

News









New SEC Filing (April 18, 2014)

Provectus raised approximately $3.4 million using Network 1 Financial as a placement agent. Thursday's Form D filing is here. While the fund raising likely was done at a premium to the then share price, no information regarding warrant coverage was provided by management. As at mid-March, when the company filed its 10-K, cash on the balance sheet probably was about $16.5 million (assumes a monthly cash burn rate in 1Q14 of approximately $953K, the same as 4Q13).

This April raise appears to be related to (and facilitated) a potential listing of the stock on the New York Stock Exchange ("NYSE") MKT (the old American Stock Exchange or AMEX). While the NASDAQ required of the company a share price over $3 for five consecutive days, the NYSE MKT appears to have been less stringent on share price (e.g., $2 for one day) but possibly more stringent on other aspects of its listing standards. In particular, I think the company raised money, in part or in whole, to address the required shareholders' equity threshold.

As at June 30, 2013, with a share price at or around $0.65, warrant liability ("WL") on the balance sheet was $2.6 million and stockholders' equity ("SE") was $6.4 million. As at September 30, with a share price at or around $0.77 (and greater price volatility), WL was $3.5 million and SE was $8.7 million. As at December 31 and a $2.41 share price, WL was $12.9 million and SE was $6.6 million. It's possible the raise (net of placement agent fees and expenses), adjusting for another month of cash burn (i.e., through mid-April) and option exercises (and what if any cash from warrant exercises), may have been required to meet the $4 million SE threshold, particularly if higher share prices and price volatility than those measured at 12/31/13 were used for warrant liability calculations.

(connecting the dots blog)