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Flat lined out today, big vol drop off- big selling/dumping of last week appears over for now at least, IMO.
But they had the spread Grand Canyon wide end of day to try and prop it up, but looks like there was no takers.
It flat lined, last trade posted was 2:07 Eastern, almost 2 hours before close of market. It just sat until close, not even a $200 trade or anything, on a 15% spread of .0172 Bid and .0198 Ask, WOW.
Total vol for the day was approx. 306K X .0180 = about $5K traded, for a full trading day.
A "twitter" link to an old article from 2008/2009 about Myocell?
It wasn't long after that, that the key phase II/III trials on ole Myocell went in the parking lot for, "Lack of funding" (see their SEC filings). Also, check SEC filing to see that most key patents on same have expired, will ne expiring soon and/or key licenses lapsed (last 10-K, end of yr 2013)
Wow. Just like they link to old pay-to-make PR videos and old articles all the time on their "twitter" feed. OK, great.
It's obvious IMHO, that someone's been told to fill the twitter feed daily, all day, every day- and thus find any content to post up on it- which would include IMO just scraping/finding any old links, old stories, old video links- pretty much anything they can scrounge up and find and toss on there to fill it, especially with stem cell related key words or that would look/sound "important" about things like Myocell for instance, especially to someone new who doesn't know much about BHRT.
Nothing new here IMO. What's supposed to be inferred from some link to an old 2008 Myocell article? They linked not long ago to the old "BILLION DOLLAR" ole "American Investor" pay to promote video from what, 2011 I think it is? What was the point of that? Lots of links to old "stuff" on that twitter account- all the time, IMO.
Twitter? Look at everything else they post on their twitter account- from anything that has the key words "stem cell" in it, to linking to vitamin type "health" articles like you'd find on Dr. Oz or something, to pretty much anything that's got some health or medical key words in it- it's just to fill the feed with key words and so called "content" to make it look "busy".
What's a twitter post or feed amount to? Not much IMHO.
Notice, vol was ZERO on open. That's far more interesting to me, IMO. It looks like the big selling/dumping might be finished for now and it's gonna go back in low vol, flat-lining mode perhaps? It took to 10:07 Eastern (37 min after market open) to post the first 50K share trade (about $900 bucks worth)
"$50-$100"?? An increase in price of about 2,500 to 4000 times it's present levels?? Giving it a market cap, instantly of approx. $20 to $40 BILLION dollars or more? Huh?
Just for perspective, here are some of the most well run companies in this nation w/ market caps in that range:
Baxter, market cap $36 BILLION, world wide employees 61 THOUSAND, shares outstanding 540 MILLION , earnings $3.55/share, dividend yield 3.5%
(BHRT has about 4 full time and one part time employee, shares outstanding passing 600 MILLION w/ 2 BILLION allocated)
Abbott labs, market cap $61 BILLION, world wide employees 69 THOUSAND, shares outstanding 1.5 billion.
Boston Scientific, market cap $15 BILLION, world wide employees 23 THOUSAND, shares outstanding 1.3 BILLION
Regeneron pharma, market cap $37 BILLION, world wide employees 2,500, outstanding shares 100 MILLION
Jazz Pharma, market cap $9 BILLION, world wide employees 830, outstanding shares 60 MILLION
Incyte, market cap $8.5 $BILLION, world wide employees 481, shares outstanding 168 MILLION
BHRT, it's at about 1.8 PENNIES as of now, with a very recent low of about 1.5 pennies. It's collapsed in about a 6 month period from about 8 cents to 6 cents (March-April PR hype run-up) to the new, recent lows of 1.5 cents or so.
This has all occurred despite the infamous, highly touted "article" or "PR release" of the 12 month "update", regarding the 5 person, tiny, phase I, Mexico trial known as "Angel". Also, despite numerous other PR releases about what I guess is their "new business" or "business model" of some sort, apparently largely abandoning heart related trials and morphing into some kind of medical tourism outfit, I guess offering non FDA approved "treatments" and other "services" both inside the U.S. (according to their own recent video) and mostly in 2nd and 3rd tier nations outside the U.S. via some sort of "network" and vaguely described "partnership(s)" and even the word "franchise" was used in one videos? None of which is clear IMO as to how it will "work" or how these "treatments" are being used when none of them appear approved or proven safe for the maladies/conditions they're being claimed to "treat" as far as I am aware of per reading the statements of the FDA and other major stem cell researchers, highly respected stem cell researchers at top academia institutions, investigative journalism pieces such as the 60 minutes stem cell series, etc.
Read the 10-K and 10-Q filings (it takes understanding basic accounting, but all the information is in there)
Also, read the complete text of the latest "finance" deal with Magna, for a grand total of about $200K, see what horrendous terms BHRT signed and accepted for a pittance of $200K cash.
PR versus SEC filings. PR can be written to make things sound one way (PR will always only emphasize and be written to sound positive), SEC filings are pure reality- they must present all facts and all accounting details w/o bias or omission of facts, by law.
One simple example. That reported "revenue" in the PR- has a cost of sales associated with it. So less than $819K went in their bank, quite a bit less. At the same time, their expense line increased by more than that amount resulting in an operational loss for the qtr, almost identical to the loss from operations, same period 1 yrs ago- nothing changed for the most part. They handed out more in just bonuses to Comella and Tomas than any "net revenues" brought in for the yr.
"Net income"- only an accounting entry generated by the one time discharge of debt. In one case the hospital wrote off the bad debt- meaning BHRT never paid them back. In the other cases so far- it's all been done via dilution (debt to equity swaps, large chunks of shares being issued), meaning they never generate any cash that goes to paying down debt, they just dilute, dilute and dilute more. Back out the one time gain, as will happen this next qtr, and they will be right back at net income loss (the operational loss matters much more anyway, as that's the real cash losses, not manipulated by accounting entries- it's why net income is never as important as cash flow, and free cash flow when evaluating the true financial condition of any business).
Their 10-Q, last filed still contains a "going concern" warning as their financial condition, especially cash position at any given time is dire (They finished last qtr w/ about $90K total cash in the bank- nearly broke, typical). They survive from paying even common bills by issuing common stock- as they do not have the cash to meet even paying their most basic bills.
From last 10-Q filing:
Page 4: Cash and cash equivalents $91,221 ($91K dollars, broke essentially)
Page 4:
Current liabilities:
Accounts payable $2,183,285
Accrued expenses $2,300,700
(so right there, that's over $4 MILLION in just immediate liabilities, against $90K cash on hand, close to insolvency if not for diluting shares)
Page 4:
Total assets $224,220
Total current liabilities $9,759,137
(again, essentially broke as they generate no cash flow and have over $9 MILLION in current liabilities and no assets for the most part, nothing that could even be shed/sold off to generate cash, thus again- share dilution and toxic convertible debt deals via lenders of last resort)
Page 5: Net loss from operations (6 month period ended June 30th)
Period ended 2014 (1,078,971)
Period ended 2103(1,123,232)
Almost identical, meaning the "revenues" made very little difference, as their expenses increased tremendously, again large salary boosts and bonuses for two people being a big part of that increase.
Page 11:
"NOTE 2 – GOING CONCERN MATTERS
The accompanying unaudited condensed financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying unaudited condensed financial statements, during six months ended June 30, 2014, the Company incurred an operating loss of $1,078,971 and used $507,059 in cash for operating activities. As of June 30, 2014, the Company had a working capital deficit (current liabilities in excess of current assets) of approximately $9.6 million. These factors among others may indicate that the Company will be unable to continue as a going concern for a reasonable period of time.
The Company’s existence is dependent upon management’s ability to develop profitable operations and to obtain additional funding sources. There can be no assurance that the Company’s financing efforts will result in profitable operations or the resolution of the Company’s liquidity problems. The accompanying statements do not include any adjustments that might result should the Company be unable to continue as a going concern."
That's just a few examples of an actual SEC filing reality, versus a PR, press release version. ALWAYS use the SEC filings when evaluating the true conditions and events at any public traded company, IMO. My 2 cents. I don't care what any "PR" ever says. PR is just that, PR.
"How do you not see the massive potential in this stock??"
Cash poor, debt laden and with a recent low common share price of about 1.5 cents today and just did a horrendous "finance" deal with a company called Magna for a grand total of about $200K in cash, but one that will result in probably 30 million plus shares in dilution.
They're so cash poor at any given time- that if one reads their 10-K/10-Q filing one will see literally, 10's of millions of shares of common stock being poured out, typically at a discount to market price, to pay everything from common bills like accounts payable to "interest owed" and vague entries to unknown parties such as, "for services rendered", etc
Nearly all key patents for their "flagship" "heart" product expired, a lien via Northstar giving them ownership over pretty much anything the company has or will have. They essentially license most of what they have as so called "technology" - meaning they don't even own it, nor did they invent it.
Endless dilution and use of convertible debt, toxic financing. Giving huge bonuses and raises to two insiders- when their entire medical R&D budget is running about $5K a month. (share count more than doubling in a single year period, now passing 600 million shares of common and 2 BILLION shares now authorized)
All major phase II/III trials they have stalled out for "lack of funding" according to their own SEC filings (Marvel, Mirror, Regen) despite handing out nearly a million in just "bonuses" to two people- not even counting their base salary pay increases.
Not even remotely close, as in years away, from any FDA approval of their major, once primary touted, product and focus, let alone no money to fund or finish those trials.
Now branching into some odd-ball (IMO) blend of off-shore, 2nd and 3rd world "medical tourism" using unproven, un-tested, non FDA approved so called "treatments" using stem cells??
I mean what am I missing here? What could possibly go wrong? Tell me what I'm missing I guess? What? Where?
"They mentioned they recently opened up a new office together in sunrise Florida"
All I see- is this "stemcellsgroup" or whatever they're called- now have their address listed as the same address as Bioheart. How would that be a "new" facility?
How exactly do they offer "treatments" (exact words used in the video) in the United States (exact words in the video) when there are no FDA approved stem cell "treatments" for anything they discuss as the maladies they supposedly "treat"? How does, or would that work? They did not say under strict FDA protocols in controlled trials- they said they're marketing and selling various "treatments" via doctor's offices/clinics both here (meaning the U.S.) and also outside the U.S.- I find that fascinating?
"How in The halibut is this going to sub .01 with positive 12 month data and partnerships worldwide and cash flow finally coming in??
1) How is it at .0152 bid right now? Not far from .01 and w/ a sub $8 million market cap now, not even equal to their outstanding debt.
2) What impact did what's described as "positive 12 month data" have on anything? The PR is out, along with several others- what difference has it made- look at the enormous selling pressure and price collapse in just a one week period? What explains that?
3) They have no "cash flow", world wide or otherwise, never have had "cash flow". They report operational losses every qtr since as far back as I've ever read in their SEC filings. Further, any "revenues" (which are not cash flows), any revenues to-date, were turned around and used up on their expense line, a large portion going to very large salary increases and bonuses to just two people in the company. Again, read SEC filings 10-K through latest 10-Q's. Whatever revenues they've brought in, they've spent as much or more in increased expenses essentially- that's my read of the past few 10-Q's, one can read um for themselves and draw their own conclusions.
4) "partnerships" with who? What do they amount to? With "doctors" offices in 2nd and 3rd world countries for non FDA approved "treatments" being done off-shore? That's their plan and future as a public traded company? OK, but I don't "see it" or "get it"? Just my opinion.
5) Their financial condition is still horrible IMO, they are cash poor and still carrying heavy debt. Read the recent Magna toxic, convertible debt deal they just did for a grand total of about $200K dollars- it's as toxic a convertible debt deal as I think I've ever seen. Dilution from it will be massive. They are still a "going concern risk" and have "liquidity problems" according to their own SEC filings, including the most recent ones.
6) Dilution and lots of it, combined with use of "convertible debt" (aka toxic death spiral or toxic debt) "financing" has consequences IMO. Those consequences are what one is seeing right now in the large sell off, IMO
7) Pull up a chart going back 3 yrs. It's stunning how repeat the pattern is IMO. It's run-up about every March/April for the most part (using PR hype IMO) and then sells off from there, typically hitting the 1 cent range or even new lows in the Oct-Dec time frame. It hit its all time low of 6/10ths of one cent in Dec of 2013, almost 1 yrs ago now. And it's in free fall right now heading into the same time period, end of yr. The chart for the past 3 yrs is a near perfect overlay from yr to yr of this pattern.
How could it hit 1 cent or sub 1 cent? A multitude of ways IMHO, that's the way I see it. Easily could hit that price range- I don't know any reason why not?
"Be careful I think this can go below .01 back to subs"
I'd say you're right. At least .01. Just look at a long term chart and when it's hit this sell/dump "mode" prior, many times.
Seems to seek and eventually find and bump along the 1 cent line many, many times past.
I think, IMO, it's all and always related to dilution, the continual issuing of cheap shares and doing deals with the likes of the ASHER'S and Daniel James and now "Magna"s of this world- toxic, convertible debt "financing". This pattern from reading so many other boards here on I-HUB, or the web, about companies who go down the "convertible debt" road with the similar kind of highly dilutive, steeply discounted shares and "finance terms" with the same named financing firms and so forth- they all seem to end up about like this, IMO.
Here's a couple of the I-HUB entire threads people felt compelled to build just about "ASHER" as they saw so many micro-caps getting the share price crushed over time, after doing "finance deals" with that one firm.
http://investorshub.advfn.com/~-ASHER-~-25451/
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=68247638
Lots and lots of stories/testimonials of woe, seem a common, repeated theme IMO when Asher and similar "convertible debt", lenders of last resort, name's come up.
Again, just my 2 theory on the major sell-off. Who knows for sure?
"Bioheart on the breakout board!"
Well, it looks likes it "breaking" to the down side collapse. Down another 9% plus this AM, bid at .0152 and no big rush of buyer's stepping in?
How many PR in how many days, including the long awaited "big one" the ole Mexico, 5 person "trial" update? And what's it done- sold off by the truck load for days now on very high volumes.
This appears to be in free fall, catch a falling knife territory IMO. Who knows where the bottom even is? And, then add-in the recent Magna "finance" deal- probably some of the worst terms I think I've ever seen or read, and BHRT has already done some pretty bad convertible deals in the past, so that's saying a lot, and it was all for about a pittance $200K cash?
Doesn't look too good here IMO. Somethings appears to be amiss from the way it's trading, or some of the big boys are unloading a ton of shares or something. Nothing so far (not multiple PR or whatever) has been able to put even a iota of support back under the falling bid and stem the selling.
I don't think the "breakout board" is gonna cut it.
My 2 cents.
Tiny buy on close- to "walk it back up", kinda figured. They're playing this thing like a fine tuned Stradivarius.
But it dumped hard to the new, recent low of .0155 in a blink (down 11%), and on a good size vol spike, about one minute prior to close. Then they just closed it out on a tiny buy order or two, back to .0170. Nice work by whoever is handling this large selling for whoever their large client is, IMO. Real smooth.
.0155 holy cow- looks like volume just spiked and they just dumped another huge chunk going into closing. WOW.
I'm on 15 minute delay- so can't see closing price yet, but the volume just spiked and they dumped off down 11% in a blink.
Guess they're still not done unloading this position for whatever "big boy" or insider is selling. Wonder how long this will go on?
Form 13 filing is showing Northstar has gained more shares:
Form 13 from July 25th, 2014:
Shared voting power: 51,853,696 capital shares (31,853,696 shares of common and 20,000,000 shares of preferred)
Form 13 just filed from Oct 1, 2014
Shared voting power: 52,368,582 capital shares (32,368,582 shares of common and 20,000,000 shares of preferred)
So, looks like Northstar just picked up another 32,368,582- 31,853,696 = 514,886 shares of common stock.
Bout half a million shares. Just more dilution and nothing new. It'll most likely be listed for something like "interest owed" or similar. It's in every 10-K and 10-Q they file from what I've read.
They hand out shares all the time for payment of all sorts of stuff. They have no cash for the most part at any given time- so everybody gets paid in common shares of stock. Who knows what price they got um at- won't know until the 10-Q or 10-K file is releases and it will be listed on some line item in there. This occurred on Oct-1, so may or may not be in this next 10-Q filing, as the qtr ended on end of Sept.
Just more shares being issued out- nothing new IMO.
"I am assuming that since it has been stated many times online that Bioheart has had over 100 million dollars put into R&D."
Well, they've diluted out to about 600 MILLION shares along the way to pay for that too. As BigAl just aptly pointed out- they, BHRT has a Accumulated deficit (paid in capital deficit) of (117,954,949$$$)
That's $117 MILLION dollars sunk into the company, which now has about an $8.X million dollar market cap, while still carrying about $10 million in current debt.
I'd say the vast, vast majority of that capital has been paid via selling common stock to the general public, IMO. Not sure how much can be attributed to say Hart, for example. He formed and created Northstar, LLC and they put up some collateral to keep a defaulted loan from being "called in" (aka bankruptcy)- but they, Northstar also has received a boat load of shares of stock for that, interest payments, loan payments, etc. They also got granted all the preferred shares the company currently has, 20 million with all voting control power as the preferred shares have a 25 to 1 vote over common holders and they also got a lien on nearly everything Bioheart does own, can own, would ever invent, sell in the future, etc.
See the 10-K filing end of 2013 for the lien statement - it's a doozy IMO.
" In addition, the Company executed a security agreement granting Northstar a lien on all patents, patent applications, trademarks, service marks, copyrights and intellectual property
rights of any nature, as well as the results of all clinical trials, know-how for preparing Myblasts, old and new clinical data, existing approved trials, all right and title to Myoblasts, clinical trial protocols and other property rights. In addition, the Company granted Northstar a perpetual license on products as described for resale, relicensing and commercialization outside the United States. In connection with the granted license, Northstar shall pay the Company a royalty of up to 8% on revenues generated.
"That's from all of the money put into trials over the past decade"??
What money put into trials in the last decade and by who and when? How is that known and where is that stated?
"What was the good news?"
I sorta had that same question too?
"So you're saying the market thinks Bioheart has no value?"
What's the market cap as of today, maybe $8.4 million.
What's the debt? Look at last 10-Q
If the company were to be liquidated what would be left?
The net shareholder value is negative. When the market cap does not even cover current debt, what does that mean? The basic accounting equation taught in ever accounting 101 class for example is:
Total Assets - Total Liabilities = Shareholder Equity
They also have no positive cash flow, I don't think they've ever generated cash, which only leaves dilution or borrowing. Adding to the effect that negative shareholder equity is more than just an accounting entry in this case, IMO.
Last 10-Q filing, PAGE 4:
Total stockholder's DEFICIT: (10,409,070)
It's a negative number.
When your entire market cap is $8.X million for a public traded company- that's the "value", total, the market is assigning to them. It is what it is. It's not what I think- it's basic math and numbers.
They don't own any assets essentially- like real estate or plant/equipment and so forth. They lease a relatively small facility and own some computer and lab equip and that's about it as far as I know.
Last 10-Q filing, PAGE 4 balance sheet: "total assets" are listed at $224,220. Yep, $220K, not millions, but thousands of dollars. Same page, current liabilities are listed at $9,759,137. (almost $10 Million) Just reality of the math.
Most of their key patents have lapsed from reading their SEC filings and they really haven't invented much of their own tech, IMO- they really just license a lot of it (the Lipicell becomes Adipocell, for example, because of a license issue- they didn't invent "Adipocell", they license it), so what's really there as assets? I don't know?
Last 10-K filing, PAGE 3:
"Bioheart has successfully completed various trials using adipose stem cells. In August 2013, the Company canceled its license agreement with the Ageless Regenerative Institute for adipose derived stem cells called LipiCell. Bioheart has entered into a term sheet agreement with Invitrx to License their adipose derived stem cell products. Bioheart has changed its adipose derived stem cell product name to AdipoCell. "
So they didn't invent "Adipocell" or even own it- they just license it.
What's there if they were to liquidate that would add value to the market cap assigned by the market place right now, and off-set or pay their debts? It's not what I "think", it's just the math and financials the way I see it. At this low a market cap, against their present debt - I just don't see much "value" left being assigned to whatever constitutes "the company". My 2 cents.
Agree, it's in free fall right now. No bid support at all- or the selling pressure/share overhang is just too great for any retail buying to off-set it.
The volume was dead for a month or more- now has exploded on days when it's dumping/selling off hard. This isn't retail IMO. Maybe by today on a bit lower volume it's some retail sellers- which IMO would be the little guys maybe throwing in the towel after breaking the 2 cent barrier and taking the pounding for the last several months.
Wow, down another 7 percent today and bid is still being lowered. It's a long, long way back up from here for many to ever even reach break even again. The "PR" cycles don't seem to be carrying much weight or pulling much response anymore, certainly not at least lately IMO and from how it's been trading. Odd?
What's stunning too- is the market cap now. Back at $8.4 million or so, not even their outstanding debt. The market is pretty much assigning the company (assets, pipeline, property- whatever actually makes up this company) a value of zero more or less. Not good. 1.6 cents and $8.4 million's getting awfully close to just zero.
"The whole market has been in a down trend."
Not a 20% to 30% plus one/two month down trend loss, and certainly not a loss of more than 70% in about the past 6 or 7 months? Not by a 1000 miles.
dubb, regarding market cap and O/S share calculation- the problem is, the market cap number given (not sure where you're getting it, but lets say Yahoo for example) is based on the data from the last issued 10-Q (now 3 months old).
Your math is correct- but it works out basically to the shares listed as outstanding on page 1 of the last 10-Q issued, Q-2, 2014 period ended June 30th.
The firms/web sites who display a market cap are calculating it using the last qtr's 10-Q filing O/S numbers. That's the problem. That's the last known, most up to date O/S share number they have to go on.
No one knows the new number of shares until the next 10-Q is issued. Q-3 has ended, so we're about 1 month out from that next 10-Q filing and the new outstanding share count. Then, one will see that market cap calculation adjust as Yahoo and similar sites plug in the new O/S share count in their display/calculation tables. It's shares outstanding X price today or at the moment = the displayed market cap.
If we knew the real O/S share count as of today - lets say (my guesstimate) is that it's now about 565 million or so- then the market cap on a Yahoo or similar would actually be a bit higher.
565,000,000 X .0175 closing price = $9.88 million. (Yahoo shows about $9.08 million right now)
It's the problem of lagging data, they Yahoo for example (we, no one) knows today's real, actual O/S share count- we only know what it was 3 months ago on the last 10-Q.
Hope that makes sense. Again, your math to calculate what you're seeing today is correct. But the dilution is definitely occurring and will show up after release of next 10-Q, when everyone gets the new O/S share count number.
"I calculated the market cap versus price and it still says about 500 million OS"??
They already surpassed 500 MILLION shares fully outstanding, last 10-Q and that was now 3 months ago (and the fully diluted number- meaning all shares needed to cover yet issued warrants, options, convertible debt, etc) was even a bigger number.
I'd almost guarantee they're in the 575 million shares outstanding or there abouts now, and fully diluted even much bigger than that- not even a doubt in my mind. They just did another deal with Magna that's gonna put at least 33 million more on the table- and they live qtr to qtr paying even common bills like accounts payable in common shares of stock, as they're basically cash broke at any given time.
From last 10-Q, end Q-2, 2014 Period ended June 30th (now 3 months old):
PAGE 1
"As of August 1, 2014, there were 517,272,472 outstanding shares of the Registrant’s common stock, par value $0.001 per share."
Same 10-Q page 9:
" Fully diluted shares outstanding were 588,670,163 and 290,900,920 for the three months ended June 30, 2014 and 2013, respectively and 553,719,873 and 264,534,723 for the six months ended June 30, 2014 and 2013, respectively."
10-Q filing Q-1 2014, PAGE 1:
"As of May 6, 2014, there were 466,396,016 outstanding shares of the Registrant’s common stock, par value $0.001 per share."
So just from May 6 2014 to August 1st 2014 (not quite 3 months), they diluted by 517,272,472 - 466,396,016 = 50,878,456
That's about 50 MILLION shares dilution in a single qtr- and I don't see any indication that pace is slowing down or changing, IMO?
Look at the volume on these huge sell-dump days. It's done almost no volume for a month- just sitting parked and flat lining often, then when it sells off it's gone 1.5 million shares plus.
This isn't retail selling IMO. This is just good ole dilution dumping- most likely the "financing" houses, the convertible debt deals- doing what they do.
Just read the terms on this most recent Magna deal- horrendous, and for about a lousy $200K in cash. It will end up putting about 30 MILLION shares at a minimum on the market, with a price only 1 cent, maybe even lower. That's what dilution and toxic debt financing does.
Figure out those holders of shares who get them for like 1 cent- what's their profit margin even if they sell at 2 cents or 1.75 cents. It's like having an ATM machine- you're doubling your money or making 75% on it, often in a period of a few months, maybe 6 months tops. That's a staggering return; an extremely high profit biz, but risky and shady a bit.
Dilution has consequences- that's what this is IMO. Nothing more complicated than that, the way I see it. Also, lack of confidence that this company will ever move forward something like an actual phase III, FDA level trial- they're simply broke, and when any money does/has come in so far, it's been passed straight to the few insiders and never went to any "trial" or whatever. The total monthly R&D budget has been a pittance of maybe $5K a month in these last 10-Q filings- noise level money. The same amount they paid smallcapvoice for a month of penny stock promotion service- to give some perspective.
And now all this "medical tourism" stuff and junk- it doesn't make any sense IMO. What's it supposed to amount to? Are you a legit FDA "trial", product-to-market company with serious, high quality R&D taking place- or are you now in the class of folks seen on something like the 60 Minutes documentary- offering unproven and unsafe, non FDA approved "treatments" and what not, in 2nd and 3rd tier nations, poor nations mostly, for cash? Which is it- I don't get it anymore? What's the plan?
That's my 2 cents. It's in a serious down trend and a "big boy" or "big boys" plural, are unloading some holdings- it would take tremendous buying pressure to overcome the 10's and 10's of millions of low priced share "overhang" this one's got sitting out there.
"The hits just keep coming$$$$$ "
Right to sub 2 cents so far, and a market cap now of $9.72 million??
I guess that's pretty good? Yeah, the hits are a rollin on.
Another "medical tourism" in the 2nd/3rd world "PR"??
Any trial updates about Mirror or Regen or Marvel? Is this still BioHEART, a heart research, R&D FDA type trial and product to market company anymore?
Also, once again- they state then entire population of a country as the supposed customer base and "reach" of this "treatment" facility- which appears to be nothing more than one doctor's office. OK. Great PR, IMO.
"Colombia.
Global Stem Cells Group, Inc. and Bioheart have partnered with Stemlab to introduce regenerative medicine to the more than 48 million people living in Colombia."
CIA world factbook has the population of Columbia listed as 46,245,297 (July 2014 est.) That's cool- I guess ole Bioheart and a "doctor's office"are gonna find MORE THAN 48 million. What's a a few million more- no sweat. So once again, I guess every man, woman and child in this nation of Columbia is some type of "candidate" for a stem cell "treatment" of some sort? All 48 MILLION plus- and they'll all find this one doctor's office somehow? OK, sounds good IMO.
So, again, poor people, 10's of millions are going to be flocking in for a cash only (most likely) stem cell treatment now in Columbia? The CIA world factbook, World bank and others have the Columbian avg annual income at about $7,800 U.S. dollars.
"Colombia, with an average monthly salary of $692 (47% of the worldwide average) ranked 54 out of 72 countries on the global pay scale, one position higher than Ukraine ($686) and one position lower than Bulgaria ($750)."
So that should pay for a lot of stem cell "treatments" I guess? Sounds great- great PR, IMO.
Spread is opened back up GRAND CANYON wide- looks like they're trying to put some air back in the tires, but it doesn't seem to be working so far IMO.
Bid is at .0186 or so, very low (AM low of .0181) but no large buying is occurring. They now have the ask opened up to .0230 on that bid, like a 10% or 12% more spread, holy cow.
If this is "recovery tomorrow" or "recovery day" or it will never see below 2 cents again, I'm not so sure IMO. 2 cents or below might be the new "normal" for a while the way this is trading now. No bid support- and even the wide spread and PR is not propping it up. Just too much low priced share "overhang" IMO.
It would need to break back above the 200 DMA to even begin a recovery from this down trend- and that 200 DMA is now a long ways off from this price range and new, sub 2 cent bid.
I agree- will have to see. I think this recent "Magna" deal is a bigger "event" than this AM's PR. That's my 2 cents. That "financing" deal, when you open up all the "exhibits" and see the terms and all- it's a stunner IMO. Can't be good the way I see it to go to those lengths for about $200K dollars.
Not sure what's cooking? All is a wait n see at this point. That's several recent PR releases- and they haven't moved the needle, not a bit, and volumes when not selling off have been super low, like maybe $2K total traded on some days. Look at today, right now even- a big chunk of selling, selling off hard, then it now goes parked for heading on one hour, not a single trading posting, not even for like $200 bucks or whatever? That's been the pattern recently- long pauses, then bursts of trades, then pauses, repeat. The bid is at .0198 right now, and buyers aren't rushing in to grab it at that new, low bid? It's been a while since sub 2 cents, I'm sure you're well aware of that.
I mentioned in a prior post- when one looks at the long term charts, it seems like the end of yr period is never very kind on this one. Not sure if that's some coordinated efforts by the likes of the ASHER's and similar firms they've had to deal with to get their financing? Like do those firms like to close-out or sell off their convertible shares for year end closing of their books and so forth? Don't know enough to know- but it seems feasible maybe? Who knows?
"run up for the 6 month results began two days after the announcement on March 4th."??
A chart shows the biggest part of the "run up" started exactly on March 4th, the day of the PR release (it actually appears to begin March 1 a bit, like "news" was leaked or "something" began occurring). It then rapidly rose on over 20 MILLION shares traded and certainly had no selling or drop on the "news" day like today. It then rapidly collapsed by about 50% in the following few days, dipping back as low as .030 or .0350 or so from the .08 PR hype run-up, top. Pretty much been all down hill from there since, with a few "pops" here and there along the way - a down trend.
It's lost 60% or more in share price from March 6th, 2014 or so to today, about 6, maybe a 7 month period. And the bid just broke below 2 cents this AM. It's even "flat lining" now too this AM, been sitting going on 1 hour now since last trade, even with the bid so bottomed out.
The attached chart begins at MARCH 1st, 2014. Count the vol bars on the bottom- 4 bars over is March 4th, 2014. There was no "waiting" period or delay from the March 4th PR to the PR driven "run up"- the chart is clear IMO.
Well, who are these "mystery shorts" and all? There's virtually zero, no "retail" shoring of a 2 cent stock, none. So who's "shorting" this? It could only be an institutional type trader- like someone who's providing "financing" or similar IMO.
Stated:
"Hence the drop in price so that buying at a lower price will occur?"
Well, then why cover now if that's the "theory"? If "they" these mystery people can apparently cause the price to drop 11% right now before this pre-known "big run up"- then why not just drive the price to say 1 cent, or 1/2 cent or to essentially zero? Why cover at all right now, if that's the "theory"?
If they have this "control power" over the price- why wouldn't they just take it to near zero and make almost unlimited money? Wouldn't that be more logical?
Not "getting it"- this "shorting" theory? Makes no sense IMO. This is just selling and a lot of dilutive, low priced shares "hanging" out there- as in 10's and 10's of millions of them, and more just created by this "Magna" deal on Friday. That's all I see IMO. Not unusual at all when "toxic" convertible debt is used, and used a lot. Dilution has consequences, as does issuing boat loads of below market price, cheap shares all the time- that's my 2 cent opinion. I don't see any "short and cover" vast, coordinated plan going on here- not seeing it? Who would be doing this "plan"?
"In my opinion shorts are covering for a run up."??
"short covering" = BUYING, not selling. Short covering causes the price to rise, not drop like a rock like right now on higher than avg volume.
The bid just fell through 2 cents and the market cap is now like $10.2 million, basically equal to their outstanding debts.
This is pure selling, no "short covering" IMO. Wouldn't make any sense. Dilution, dilution and more dilution and cheap shares being issued has consequences IMO. That's all that's being seen here the way it looks to me. I don't know how fast this "Magna" can start selling shares, but they just got what will be like probably 30 million plus shares in the 1 cent range- that cant' help things IMHO.
No bid support at all and selling days are the days the volume picks up- looking technically extremely weak here IMO. Now well below the 200 DMA and the 50 DMA broke under the 200 DMA and is now staying there- at least for now it looks like.
I've read the "PR", thanks. 5 people in Mexico, phase I "update".
As stated previously- any "updates" on the much larger Regen, Marvel or Mirror trials that can't move forward for "LACK OF FUNDING" per the company's own 10-Q statements?
What's an "update" on a tiny, 5 person trial in Mexico supposed to mean or eventually amount to? Is it journal published anywhere? Is it going to be a phase II now, and if so, then how they going to fund it, since all the other larger trials can't seem to find "funding"??
Just "PR" IMO. Don't see what a 5 person phase I "update" means or will amount to? Why did MIRROR vanish for example?
Any "trial news" on the already existing PHASE II and III, Mirror or Marvel or Regen trials?? Interesting the new "financing note news" is released right at close of market on Friday, followed now on Monday AM prior to market open by the "phase ONE" I guess "update" about this existing Phase ONE, FIVE person Mexico "trial"? Perfect "timing" IMHO.
From this AM PR:
" "We are looking forward to expanding this trial to include more clinical sites and patients.""
Interesting IMO, they just took on a convertible debt note deal, with extremely harsh terms (up front discount, high interest rate, steeply discounted shares, etc) that's for a grand total of less than $200K total dollars it appears- so what are they going to fund this "expanding trial" with? Their existing trials that are much further along than this small phase I, five person Mexico trial, all those seem to be stalled out for lack of "funding" - so what's gonna fund this additional trial and its "expansion"? And how and when and where? Is it going to be a phase II now? Do they ever publish these PR proclaimed "results" in any peer reviewed journals or similar, or is it always just what they report in their own PR? Why do they never publish anything in journals, at least not that I'm aware of, at least not that I've seen recently (past several years) that I am aware of?
If they needed that cash so bad as to be willing to take on this very recent (last Friday) "Magna" convertible debt, highly dilutive "note" for about $200K total dollars (not even a month or two's cash use per their recent SEC filings), then how are they going to fund and "expand" this phase I trial? Do the Regen and Marvel and Mirror trials- all just remain "parked" on the side lines, I guess?
From last 10-Q filing, end Q-2, 2014, PAGE 27:
"We are seeking to secure sufficient funds to reinitiate enrollment in the MARVEL and REGEN trials. If we successfully secure such funds, we intend to re-engage a contract research organization, or CRO, investigators and certain suppliers to advance such trials. We have initiated and enrolled our first patient in the MIRROR trial in 2013. The trial is very similar to the MARVEL trial but focusses on sites outside the US. We will continue enrollment in the MIRROR trial once we have secured sufficient funds."
So what exactly is the real "news" in this AM's PR - not sure I really understand it or see what it's supposed to lead too and how? Their other much larger, much more "mature" trials aren't progressing for "lack of funding", and this is a very small, 5 person trial in Mexico with nothing but an "update"- so what comes next, or where does this really lead? Is anything going to be published in a major, peer review journal about these reported "results"?
Not seeing how this changes much IMO? That's just my 2 cents.
New toxic note- appears is not even $200K cash to BHRT. One needs to go to EDGAR, the SEC filing site and read the entire 8-K filing and all exhibits- it's a stunner IMHO. It looks pretty clear IMO, that BHRT doesn't even net $200K on it, but could owe as much as $300K to pay back the note- in dilutive shares of course. To read the entire thing, and all exhibits is like a 50 page deal.
Also, interesting is why did BHRT file an 8-K on this? They've been doing ASHER and similar type "finance" deals for years now- and never file an 8-K. Well, in reading the document, it's stated that MAGNA required as part of the deal- that BHRT file an 8-K, making it all public. And, also has them paying up to $30K in legal fees and all kinds of other restrictions, covenants and "stuff". IMO, BHRT must be incredibly desperate for cash to have taken on a convertible debt note that reads like this one- it's a doozy when one tries to read it all, IMO. Further, given the stiff terms that this MAGNA put up in front of BHRT- they must feel that BHRT is an extremely high credit risk or even a default risk IMHO, the language eluding to all kinds of stuff about defaulting and penalties and if this happens, then you owe us this and such- is plastered all through out the document. And Tomas signed off on all of it- so they must really, really, really be desperate for a lousy $200K or less that this Magna is going to pay them (after the "up to" $30K in legal fees BHRT must pay to Magna)- it's a real whopper deal IMO.
Again, what's $200K? Not even a few months survival cash - not even one of the bonuses they just handed out to Comella, let alone Tomas' huge bonus. Why would they take such horrible terms for a few $hundred thous in cash? Why? IF some supposed "big financing" supposed deal is sitting right around the supposed next bend in the road?
http://www.sec.gov/Archives/edgar/data/1388319/000114544314001228/d31725.htm
http://www.sec.gov/Archives/edgar/data/1388319/000114544314001228/d31725_ex4-1.htm
http://www.sec.gov/Archives/edgar/data/1388319/000114544314001228/d31725_ex10-1.htm
http://www.sec.gov/Archives/edgar/data/1388319/000114544314001228/d31725_ex10-2.htm
From "exhibit" 10.1:
"NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and in consideration of the premises and the mutual agreements, representations and warranties, provisions and covenants contained herein, the parties hereto, intending to be legally bound hereby, agree as follows:
1. Purchase and Sale of Note. On the Closing Date (as hereinafter defined), subject to the terms and conditions of this Agreement, the Investor hereby agrees to purchase, and the Company hereby agrees to sell and issue, a Note in the principal amount of $307,500 (the “Principal Amount”).
2. Purchase Price. The purchase price for the Note to be purchased by the Investor at the Closing shall be $205,000 (the “Purchase Price”). The Note will be issued with an original issue discount of approximately 33.33%. The Investor shall pay approximately $0.6666 for each $1.00 of principal amount of the Note to be purchased at the Closing. At the Closing, the Investor shall fund the Purchase Price by wire transfer of immediately available funds to the account specified in writing by the Company prior to the date hereof.
3. The Closing. Subject to the conditions set forth below, the purchase and sale of the Note shall take place at the offices of Greenberg Traurig, LLP, The MetLife Building, 200
Park Avenue, New York, New York 10166, on the date hereof (the “Closing” and the “Closing Date”). At the Closing, the Company shall deliver to the Investor: (i) this Agreement duly executed by the Company, (ii) the Note in the Principal Amount duly executed by the Company and registered in the name of the Investor and (iii) the Registration Rights Agreement duly executed by the Company. At the Closing, the Investor shall deliver to the Company (i) this Agreement duly executed by the Investor and (ii) the Registration Rights Agreement duly executed by the Investor.
4. Closing Conditions; Certain Covenants.
4.1 Conditions to the Investor’s Obligations. The obligation of the Investor to purchase the Note to be issued to the Investor at the Closing is subject to the fulfillment, to the Investor’s reasonable satisfaction, prior to or at the Closing, of each of the following conditions:
(a) Representations and Warranties. The representations and warranties of the Company contained in this Agreement shall be true and correct in all material respects on the date hereof.
(b) Note. At the Closing, the Company shall have tendered to the Investor the Note.
(c) Registration Rights Agreement. The Company shall have duly executed and delivered the Registration Rights Agreement to the Investor.
(d) No Actions. No action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any court, governmental agency or authority or legislative body to enjoin, restrain, prohibit or obtain substantial damages in respect of, this Agreement or the consummation of the transactions contemplated by this Agreement.
(e) Proceedings and Documents. All proceedings in connection with the transactions contemplated hereby and all documents and instruments incident to such transactions shall be reasonably satisfactory in substance and form to the Investor, and the Investor shall have received all such counterpart originals or certified or other copies of such documents as it may reasonably request.
4.2 Conditions to the Company’s Obligations. The obligation of the Company to sell and issue the Note to the Investor at the Closing is subject to the fulfillment, to the Company’s reasonable satisfaction, prior to or at the Closing, of each of the following conditions:
(a) Representations and Warranties. The representations and warranties of the Investor contained in this Agreement shall be true and correct in all material respects on the date hereof.
(b) Purchase Price. At the Closing, the Investor shall have tendered to the Company the Purchase Price (less the amounts to be withheld pursuant to Section 10.12) by wire
2
transfer of immediately available funds to the account specified in writing by the Company prior to the date hereof.
(c) Registration Rights Agreement. The Investor shall have duly executed and delivered the Registration Rights Agreement to the Company.
(d) No Actions. No action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any court, governmental agency or authority or legislative body to enjoin, restrain, prohibit, or obtain substantial damages in respect of, this Agreement or the consummation of the transactions contemplated by this Agreement.
(e) Proceedings and Documents. All proceedings in connection with the transactions contemplated hereby and all documents and instruments incident to such transactions shall be satisfactory in substance and form to the Company and the Company shall have received all such counterpart originals or certified or other copies of such documents as the Company may reasonably request.
4.3 Securities Law Disclosure; Publicity. The Company shall (a) by 9:00 a.m. (New York City time) on the business day immediately following the date hereof, issue a press release disclosing the material terms of the transactions contemplated hereby and (b) issue a Current Report on Form 8-K disclosing the material terms of the transactions contemplated hereby, and including the Transaction Documents as exhibits thereto, within the time required by the 1934 Act. From and after the issuance of such press release, the Company represents to the Investor that the Company shall have publicly disclosed all material, non-public information delivered to the Investor by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Transaction Documents. The Company shall afford the Investor and its counsel with a reasonable opportunity to review and comment upon, shall consult with the Investor and its counsel on the form and substance of, and shall give due consideration to all such comments from the Investor or its counsel on, any press release, Commission filing or any other public disclosure made by or on behalf of the Company relating to the Investor, its purchases hereunder or any aspect of the Transaction Documents or the transactions contemplated thereby, prior to the issuance, filing or public disclosure thereof, and the Company shall not issue, file or publicly disclose any such information to which the Investor shall object. For the avoidance of doubt, the Company shall not be required to submit for review any such disclosure contained in periodic reports filed with the Commission under the Exchange Act if it shall have previously provided the same disclosure for review in connection with a previous filing."
Make money? How? A perspective on this latest, highly dilutive, toxic, convertible debt note amount versus the salaries and bonuses of just two people in the "company":
The total note is maybe $300K ($307K, but it also has up to $30K legal fees deducted, see bottom of 8-K text, and may from the first lines, be only maybe $205K cash purchase price to BHRT depending on if BHRT meets all the clauses). So lets say for a $300K note, with 1 cent shares handed out (about 30 MILLION in dilution minimum, probably a lot more given Magna/Hanover's reputation upon some basic reading about them)- lets say BHRT gets about $270K tops to put in their bank after all the fees and what not, on the high side. $270K total.
Just Tomas and Comella got $500K and $300K bonuses handed to them this last 10-Q, respectively. That's $800K annually right there.
Tomas now got his base salary boosted to $525K a yr and Comella got a boost to $250K per yr + their $500K and $300K in promised bonuses for this yr. See last 10-Q filing, PAGE 25
So just those two, not even considering rent/lease, insurance, legal, accounting firm, a couple of employees, computer/phone, and all the other basic overhead expenses to run this tiny micro-cap: just these two's salary and now "perk" cash bonus are:
$525K + $500K = $1,025,000 for Tomas, yep, $1.025 MILLION per yr
$250K + $300K = $550K for Comella, over a cool half mil per yr
That's $1,025,000 + $550,000 = $1,575,000 or $1.575 MA MILLION consumed in cash, just to pay two people at a company of maybe 4 or 5 people total, and near zero cash at any given time per their own SEC filings, going concern warnings, and all the rest.
$1,575,000 / 12 = $131,250 PER MONTH it takes just to pay these two
PERSPECTIVE: They just did a convertible debt note w/ steeply discounted shares that will be highly dilutive and more than likely put huge downward selling pressure on the common stock for an amount that essentially doesn't even pay Comella's BONUS for the yr ($300K).
Not "trials" getting funded, not research and development, not funding a growing business or whatever- it won't even put a dent in paying the two people who keep getting ever bigger salaries and now ever bigger bonuses.
That note is about TWO MONTHS, maybe 2.5 months salary/bonus for two people - that's all it "buys" for the company. A couple of month's or so cash use, tops at their burn rate IMO. The 10-Q showed: "incurred an operating loss of $1,078,971 and used $507,059 in cash" or the 6 months ended June 30th, and that's before the $800K in bonuses plus salary increases were now tacked on.
They took on a toxic debt note for an amount not even making a dent in the salaries, let alone the bonuses of two people. THAT is "perspective" in my opinion. Add in all the other expenses, just burn rate of the business- and they had to take on a note with these horrendous terms, for a few month's at the most of cash? Really?
Well, not good IMHO. I don't see any phase II or III level "trials" getting "funded" or progressing or whatever because of this "finance deal". What happened to the "big funding" from some "deep pockets" firm and all (the supposed reason for the increase to 2 billion shares??)- that's been talked about endlessly? It never materializes. Just more dilutive ASHER type deals continuing, but only with worse and worse terms IMO. That's all I see. Not "making money", they never make any money. They spend and lose money and take losses and dilute- that's about all I ever see or have seen? All while the 10-K and then every 10-Q after it says the major trials are "ON HOLD FOR LACK OF FUNDING". But the bonuses and salaries aren't "lacking funding"- no.
That's my 2 cent take on it.
Here's from the later lines in that 8-K on this note deal- it's even better:
"The Purchase Agreement contains customary representations, warranties and covenants by, among and for the benefit of the parties. The Company also agreed to pay up to $30,000 of reasonable attorneys' fees and expenses incurred by Magna in connection with the transaction."
So on top of steep share discounts, front end potential discounts and all the rest- BHRT even has to pay this Magna "attorney fees" and "other fees", nice. Real sweet deal.
It's hard to tell, as I stated, how much actual cash BHRT will even bank when this is all said and done, but will owe the face value of the note from the way it reads, and at 12% interest, when people and businesses can get loans for maybe 3 or 4%, and even junk debt is maybe 6% or 8% tops in this zero interest environment. And Magna will have the right to convert those shares to free trading at any time they want from my read on it, 1 cent, or less, shares essentially. 30 million plus, low priced shares on the selling block at some point.
Amazing IMO.
Released at CLOSE OF MARKET on a Friday- the "usual" IMO. Perhaps some of this explains the heavy selling and dip to hitting .02 three times now in 2 days?
The 8-K shows prepared on Oct 7th, 3 days ago, but they waited till Friday close on the 10th to post it on the public PR channels?
This one is gonna take some research/digesting to fully figure out what it all means- but it sure doesn't look good IMHO, 2 cent opinion.
Bioheart, BHRT just took on a "MAGNA" deal today- as seen in this 8-K filing. WOW, IMHO. I've seen BHRT use ASHER and similar for years, but this "Magna" terms, they look unbelievable. Stunning IMHO how steep and brutal the terms are, all for a pittance of about $300K (I'm not even sure it's that much- it looks like Magna gets an "up front" discount and only pays like $200K actual cash to BHRT, for a $300K "note"?)
Wow, this Magna is like 2 notches below pay-day loan terms IMO. These are as steep a terms as I can remember seeing in a toxic finance deal. Holy cow IMO !!
http://www.sec.gov/Archives/edgar/data/1388319/000114544314001228/d31725.htm
"
Item 1.01 Entry into Material Definitive Agreement
Securities Purchase Agreement and Convertible Note
On October 7, 2014 (the “Closing Date”), Bioheart, Inc., a Florida corporation (the “Company”), entered into a securities purchase agreement dated as of the Closing Date (the “Purchase Agreement”) with Magna Equities II, LLC, a New York limited liability company (“Magna”). The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, Magna shall purchase from the Company on the Closing Date a senior convertible note with an initial principal amount of $307,500 (the “Convertible Note”) for a purchase price of $205,000 (an approximately 33.33% original issue discount). Pursuant to the Purchase Agreement, on the Closing Date, the Company issued the Convertible Note to Magna.
$40,000 of the outstanding principal amount of the Convertible Note (together with any accrued and unpaid interest with respect to such portion of the principal amount) shall be automatically extinguished (without any cash payment by the Company) if (i) the Company has properly filed a registration statement with the Securities and Exchange Commission (“SEC”) on or prior to the Filing Deadline (defined below) covering the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note and (ii) no event of default or an event that with the passage of time or giving of notice would constitute an event of default has occurred on or prior to such date. Moreover, $62,500 of the outstanding principal amount of the Convertible Note (together with any accrued and unpaid interest with respect to such portion of the principal amount) shall be automatically extinguished (without any cash payment by the Company) if (i) the Company has filed a registration statement with the SEC that has been declared effective by the SEC on or prior to the Effectiveness Deadline (defined below) and the prospectus contained therein is available for use by Magna for the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note and (ii) no event of default or an event that with the passage of time or giving of notice would constitute an event of default has occurred on or prior to such date.
The Convertible Note matures on August 7, 2015 and, in addition to the approximately 33.33% original issue discount, accrues interest at the rate of 12% per annum. The Convertible Note is convertible at any time, in whole or in part, at Magna’s option into shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), at a fixed conversion price of $0.01035 per share (subject to adjustment). This conversion price represents a discount of approximately 55% from the lowest trading price of the Common Stock during the five trading days prior to the Closing Date. If the Company has not properly filed a registration statement with the SEC on or prior to the date that is 70 calendar days after the Closing Date covering the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note, then, from and after such date, the Convertible Note
will be convertible at any time, in whole or in part, at Magna’s option into Common Stock at a conversion price equal to a 55% discount from the lowest trading price of the Common Stock during the five consecutive trading days ending and including the trading day immediately preceding the applicable date of conversion. At no time will Magna be entitled to convert any portion of the Convertible Note to the extent that after such conversion, Magna (together with its affiliates) would beneficially own more than 4.99% of the outstanding shares of Common Stock as of such date. The Convertible Note includes “full ratchet” and standard anti-dilution protection.
The Convertible Note includes customary event of default provisions, and provides for a default interest rate of 18%. Upon the occurrence of an event of default, Magna may require the Company to pay in cash the “Event of Default Redemption Price” which is defined in the Convertible Note to mean the greater of (i) the product of (A) the amount to be redeemed multiplied by (B) 140% (or 100% if an insolvency related event of default) and (ii) the product of (X) the conversion price in effect at that time multiplied by (Y) the product of (1) 140% (or 100% if an insolvency related event of default) multiplied by (2) the greatest closing sale price of the Common Stock on any trading day during the period commencing on the date immediately preceding such event of default and ending on the date the Company makes the entire payment required to be made under this provision."
8-K, looks like more TOXIC CONVERTIBLE DEBT "financing" and the terms on this one are stunningly horrible IMO, even worse than the past ASHER or similar toxic/convertible firm, deals. Maybe ASHER isn't even doing deals with these guys anymore? So now they're tapping this firm "Magna" for about $300K of survival cash at extremely dilutive terms. Plus a 12% interest rate (beyond junk bond status) when interest rates are at historic lows. A share conversion price of $0.01035 . And a 55% discount- on conversion, WOW. Mega dilutive. This one even includes a "default provision", not anything I ever see or remember seeing in a ASHER or similar note in the past- with an 18% interest rate kick-up and then the note face value goes to 140% of outstanding- holy moly, that is wild IMO. Worse than the worst of even pay-day loan money. They must be really struggling to bring in any kind of "financing" IMHO, to accept or need to get terms like these. It's even stranger as it looks like BHRT only receives about $200K in cash, but the face value owed is $300K?? Got read this about 50 times to figure this one out- or find a forum that explains deals similar to this?? Wow again.
Also very interesting IMO, is why now is this "deal" full of a bunch of specific language about "Needing SEC approval of registration statement..blah, blah, blah" and involves upfront discounts and such tied to that? Remember the prior 8-K in which Tomas indicated that they had "questions" from the DTC about "eligibility" of shares or something to that effect? I wonder if that is all related to that?
http://www.sec.gov/Archives/edgar/data/1388319/000114544314000932/d31492.htm
"In addition, the Company has received a request from The Depository Trust Company (“DTC”) to confirm that shares of common stock deposited at DTC were eligible under the Rules and Procedures of DTC for deposit. The Company has responded to this request."
Not only is the their the traditional "death spiral" conversion provisions- the "reset" and all, but this one even carries a steep, up-front discount to Magna? Once again, where's the "big financing" so called "deal? All there is are these continued convertible, toxic note/debt deals trickling in- the reason IMO they needed to boost available shares to 2 BILLION, from 970 million- given the dilution rates, I'd guess they're gonna be bumping up against that 970 million real soon.
Look at some of the details in the 8-K disclosure, how bad these terms are:
"On October 7, 2014 (the "Closing Date"), Bioheart, Inc., a Florida corporation (the "Company"), entered into a securities purchase agreement dated as of the Closing Date (the "Purchase Agreement") with Magna Equities II, LLC, a New York limited liability company ("Magna"). The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, Magna shall purchase from the Company on the Closing Date a senior convertible note with an initial principal amount of $307,500 (the "Convertible Note") for a purchase price of $205,000 (an approximately 33.33% original issue discount). Pursuant to the Purchase Agreement, on the Closing Date, the Company issued the Convertible Note to Magna.
$40,000 of the outstanding principal amount of the Convertible Note (together with any accrued and unpaid interest with respect to such portion of the principal amount) shall be automatically extinguished (without any cash payment by the Company) if (i) the Company has properly filed a registration statement with the Securities and Exchange Commission ("SEC") on or prior to the Filing Deadline (defined below) covering the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note and (ii) no event of default or an event that with the passage of time or giving of notice would constitute an event of default has occurred on or prior to such date. Moreover, $62,500 of the outstanding principal amount of the Convertible Note (together with any accrued and unpaid interest with respect to such portion of the principal amount) shall be automatically extinguished (without any cash payment by the Company) if (i) the Company has filed a registration statement with the SEC that has been declared effective by the SEC on or prior to the Effectiveness Deadline (defined below) and the prospectus contained therein is available for use by Magna for the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note and (ii) no event of default or an event that with the passage of time or giving of notice would constitute an event of default has occurred on or prior to such date.
The Convertible Note matures on August 7, 2015 and, in addition to the approximately 33.33% original issue discount, accrues interest at the rate of 12% per annum. The Convertible Note is convertible at any time, in whole or in part, at Magna's option into shares of the Company's common stock, par value $0.01 per share (the "Common Stock"), at a fixed conversion price of $0.01035 per share (subject to adjustment). This conversion price represents a discount of approximately 55% from the lowest trading price of the Common Stock during the five trading days prior to the Closing Date. If the Company has not properly filed a registration statement with the SEC on or prior to the date that is 70 calendar days after the Closing Date covering the resale by Magna of all of the shares of Common Stock issued or issuable upon conversion of the Convertible Note, then, from and after such date, the Convertible Note will be convertible at any time, in whole or in part, at Magna's option into Common Stock at a conversion price equal to a 55% discount from the lowest trading price of the Common Stock during the five consecutive trading days ending and including the trading day immediately preceding the applicable date of conversion. At no time will Magna be entitled to convert any portion of the Convertible Note to the extent that after such conversion, Magna (together with its affiliates) would beneficially own more than 4.99% of the outstanding shares of Common Stock as of such date. The Convertible Note includes "full ratchet" and standard anti-dilution protection.
The Convertible Note includes customary event of default provisions, and provides for a default interest rate of 18%. Upon the occurrence of an event of default, Magna may require the Company to pay in cash the "Event of Default Redemption Price" which is defined in the Convertible Note to mean the greater of (i) the product of (A) the amount to be redeemed multiplied by (B) 140% (or 100% if an insolvency related event of default) and (ii) the product of (X) the conversion price in effect at that time multiplied by (Y) the product of (1) 140% (or 100% if an insolvency related event of default) multiplied by (2) the greatest closing sale price of the Common Stock on any trading day during the period commencing on the date immediately preceding such event of default and ending on the date the Company makes the entire payment required to be made under this provision.
The Company has the right at any time to redeem all, but not less than all, of the total outstanding amount then remaining under the Convertible Note in cash at a price equal to 140% of the total amount of the Convertible Note then outstanding."
Look at the dilution- at a minimum it's about $300K at .01 cents or so, I think it's actually even worse given the 55% discount- I'll have to read/study it more. But lets just say $300K at .01, that would be 33 MILLION shares at a minimum, but again, w/ the 55% discount and "reset"- the part where the language says, " price equal to a 55% discount from the lowest trading price of the Common Stock during the five consecutive trading days..." I believe will make it even more than 33 MILLION shares. Man, for just $300K, a few month's cash to hang on IMO. 33 MILLION shares at 1 cent or lower hitting the market whenever Magna wants? That's gonna be a share price crusher to the common shares, again, IMHO.
Man, you talk about desperation terms- I'll have to look up this Magna, but this is like as steep a desperation finance terms I think I've ever read? It's amazing IMO. And only for about $300K- what, maybe a few months or so of survival cash- not anything even remotely close to funding a phase II or phase III trial or anything- it doesn't even cover the recent bonuses and salary increases to the "two" and other basic overhead- given their burn rate, IMO.
Interesting, I found this I-HUB page someone has built about firms/companies who deal with "Toxic Magna Group"- Bioheart's on the list.
http://investorshub.advfn.com/Clients-of-Magna-Group-and-Hanover-Holdings-25550/
Wow, just hit .02 cents, volume picked way, way up suddenly. That's the "sad state of affairs" IMO. Market cap going back under $11 million, back towards close to their outstanding debt.
The bid is in free fall- and look at the volume now, I don't think this is Joe Q. Retail seller. This is some "bigger boy(s)" unloading again IMO- probably the "finance" convertible share people, or some of the low priced warrants- still near double their money if unloaded in the 2 cent range, when they get shares in the 1 cents range.
I agree also, this could go back to .0141 - .0155 or even lower. Don't see any support to the bid, the low volume days have been amazing- where it's doing sometimes $2K a day total maybe, with 1 and 2 hour stretches w/o a single trade, but now drops like a boat anchor on much higher volume on the big selling day.
Technicals are just all broken down in here right now. Wouldn't want to try and pick the bottom till it settles.
"Most of the market has been selling off the last couple of weeks."??
The broader market has not been "selling off" to a loss of 25% to 30% in just a one month time frame as BHRT has? Thus "comparatively" BHRT has not "held up" up at all relative to the general market(s) IMO?
Further, in a 5 or 6 month period from the April/May BHRT PR run-up (.06 to .08 price range), one would now be down 60% to as much as a 75% loss (needing a 200% plus gain now just to get back to break-even)- while the broader markets have made huge gains? Again, how would that show BHRT "holding up comparatively well"
Not seeing it?
This AM, on higher volume, it's now dumping off, down almost 11% in a single move- and looks like it might test breaking below 2 cents here. The overall market is "flat" right now at best.
BHRT has broken well below it's 200 DMA and the 50 DMA also crossed under the 200 DMA. It's in a strong down trend and technical weakness, contrary to the overall market(s). BHRT has also been trading very sporadically for over a month now IMO, some days (recently) only trading maybe $2K for an entire trading day- with periods longer than 1 hour, sometimes 2 hours w/o a single trade being posted. It then gets a higher volume spike like just now this AM, and it drops almost 11% in a single blip- not very reflective of any broader market patterns that I'm aware of?
"What a sad state of affairs"- great post Pyrrhonian, very interesting and cogent IMO.
The analysis on how the cash or any "revenues" gets spent on bonuses is very thorough I believe.
Stated:
"For instance, what if the CEO and CSO decided to cap their salaries at $125k and $75k respectively, with no bonuses or stock options going forward (they won't starve right?). That's $575k/yr plus another $200k-$800k relegated to clinical trial research. Well, in 3-4 years, that would equate to $3mm-$6mm in funding. They could easily blow out a decent size randomized Ph II on that. That would produce data to enable partnering, and you're off and running. Instead, they feast."
Great analysis on how much that bonus money could have or would have amounted to if spent on trials- very good take on it IMO. But of course the trials don't appear to be advancing (see latest 10-Q stating "waiting on funding") as all the cash/revenue goes straight to salary boosts and then even bonuses. Great observations IMO.
Volume still way off today and the 50 DMA is solidly broken below the 200 DMA. Long periods where no trades even take place- sometimes an hour or more. We'll have to see I guess.
About $1,275 total dollars traded today, wow.
And last trade was posted at about 2:56 PM Eastern, meaning it flat lined out w/o a single trade for more than 1 hour, despite the bid being so low at .0215 Seems like one large or even medium sized seller in here now and this is going under 2 cents a share IMO. It's totally broken down below the 200 DMA and the 50 DMA is now crossing under the 200 DMA.
Don't know how they're gonna raise any big financing on numbers and volume like that? Market cap is now back at just $11 million, pretty close to their outstanding major debts again.
Seems like all the PR and good news just isn't moving the needle at this point?
Not sure anymore IMO if they're now supposed to be some kind of off-shore, 2nd/3rd world "medical tourism" company offering unproven "cell treatments and therapies" for cash in these sort of odd-ball partnership deals? Or are they even still attempting to be a real "heart research" and FDA type trial and medical product research company anymore or what? I mean, the name still says BioHEART, but that sure doesn't seem to be the focus or goal anymore that I can see?
It's very confusing IMHO? I'm not "getting it" or the long term plans anymore? It used to be real clear- "heart" related research trials to get an FDA approved product to the finish line- I just don't see that anymore, per my 2 cents. Not when the R&D budget is running $5K a month but 2 people just got a sum total $800K in just "bonuses" ($800K/12 = $66K a month) and then a few pages later in that same 10-Q filing, it says all major trials are "on hold" for "lack of funding" and they finished the qtr near cash broke again??
I think Pyrrhonian pointed out and made that same point pretty well IMO
There it goes - could see sub 2 CENTS very soon IMO. There's no volume and no bid support.
Last week the 50 DMA broke under the 200 DMA, a major trading signal of weakness. Lower lows and lower highs and vol down to a pittance, except it spikes on large sell-off days.
End of year has typically not been good on this one. It made it's all time low of 6/10ths of one cent in Dec last yr, and broke into the 1.X penny range in the couple of months leading into that- just about right now on the calendar.
Always makes me wonder if end of yr is not when a lot of the convertible debt holders and other holders of the cheap issued shares do some major dumping? I've looked at charts and seems a pretty reliable pattern to me, but who knows?
Will have to see- but the technicals look real weak here IMO.