Not necessarily a good thing though. That might explain why management don't own much of Delcath Inc, but they are likely major holders of Delcath Holdings. Since Delcath Holdings isn't publicly reporting, we have no idea how much they own.

Delcath Inc was almost a feeling of a shell company, but Delcath Inc still holds many of the patents and some assets so it's not entirely so. Which only logical explanation is that they are protecting their IP from any attempt to takeover and also owns the IP.

Therefore, if we result in a buyout, the acquirer would want to buy Delcath Holdings and the intellectual properly that it owns. That = big payout for management.

People kept saying management have little to no stake in Delcath Inc, but I don't think they are just creating this company for nothing. Eventually, they will want to sell at a good price and they aren't going to be left out. Management isn't stupid.

So this is my theory that management owns Delcath Holdings which owns the IP. Delcath Inc runs public for raising funds to see the treatment through commercialization. If any dealing with Delcath for a buyout management will get paid.

Juan, the company made one huge mistake last year and that's taking out the 35 million selling convertible notes.

They burned through 23 million of that convertible in one year time and basically maxed shares authorized. So that's a gigantic dilution in short period of time crashing SP hard.

Damage is done and they have no way to repair that but an RS. But, we knew that's just going to result in massive dilution again. So they need to find another means for funding.

We're maxed on shares authorized but they might still be able to sell more preferred shares or use up whatever left of the authorized common shares. But they would need new investors to buy.

Not sure about that but it did sound as if funding was never an issue. But, you don't come out in the public PR sounded down and uninspiring.

One would think they have a plan B or even a plan C since the first vote was looking like a no back in June.

They obviously would be most interested in finding a new source of funding and try to get rid of the convertible notes more so than anything else.

I would think they want to sell the company at some point but it would be best if they secure US approval first and shown success in EU. The company could be valued in the billions.

N3, this is still a mystery. But, the sales was stated as an inter company sales. It would suggest they are separate entities. However, there appears to be some ties between the two suggesting there are potentially ownership one owns another in some way as well as the same name.

I need to read the 10K to confirm this was indeed an inter company sale. So if Holdings own the IP and Delcath is leasing from Holdings, then that means holdings are getting paid from Delcath Inc for using the IP.

It might have been a way to milk the IP for money but we don't have information on who's the sole owner of Delcath Holdings. Some said Delcath Inc actually is the owner of Delcath Holdings but that makes no sense and it was unconfirmed.

Typically, Holdings is a private company that is likely the parent company. It might be that Delcath Holdings owns a part of Delcath Inc. Which explains that Delcath Holdings owns the IP. In the event of a hostile take over, the acquirer does not own the IP.

Yes James, a partnership has the highest probability than anything else at this point.

Roche definitely have been eyeing Delcath. They have approached Delcath years ago. But, like I said before a BO = end of career for management.

It would only happen if Roche offer them a nice exit. Otherwise, selling the company would be the last thing they want to do just like BK.

However, Roche could partner with Delcath and help them market in EU as well as provide resources to complete the new trials for US approval.

That would be the best outcome for both management and us. They get to keep their jobs and we get a nice bump on the SP. No body gets hurt.

Agree, their recent trip to EU and attending various medical conventions is exactly for the purpose of networking and seeking new source of funding.

It is clear they are trying to get new investors or a partner. Otherwise, they wouldn't be trying so hard to gain exposure.

No, they can't trade on inside info, they must make sure they themselves and any affiliate does not buy company stock during any negotiation.

Bzuley, some people were digging the relationship between Delcath Holdings and Delcath Inc. The name being the same and the fact the officers are the same suggesting it's a same company. So a buyout would likely include Delcath Holdings and the IP.

Correct, only time SP has to do with acquisition is a hostile take over. But, I doubt it since Delcath has anti hostile take over measures in place.

Agree, if you bought and hold free shares that's fine but I wouldn't risk much with own money at this moment.

They have funding issues and RS is a no. They have to figure something out fast and we will hear more from the company. If good news, it should still be time to get in for a quick trade.

More questions that need answers. My thoughts are they stated on 8/21 that they will appeal for stay on NASDAQ. And, they never come out saying NASDAQ did not approve of the appeal and so that they are being delisted by NASDAQ.

Then recently they come out saying it's in everyone's interest to voluntary delist that they will being filling form 25 obviously they aren't filing form 15 since they weren't going dark.

So what happen to from 25? Even if they were being notified of being delisted by NASDAQ they didn't come out saying NASDAQ delisted them. Instead they said they are voluntary delisting which requires them to file with SEC.

We will find out. As I said good learning experience. In any case if NASDAQ was delaying form 25 it will be file eventually.

I don't think Delcath would make obvious mistakes with SEC regulations, otherwise, lawyers would be all over them. They have to have legitimate reason to accelerate the move to OTC.

Yes James, this is a good learning experience to find out the process of a company being delisted. I'm not saying I am an expert in this, but that's how we learn as investors.

Talk to professional about the case with Delcath and how they are able to simply move to OTC without following the regulations.

No, I am saying some thought that going dark was the case here which is bad for us cus the company is delisted and no longer required to report to the SEC if they went dark. But that's not the case because they didn't meet the form 15 requirements and they did not file form 15.

We're trading on OTC and they are still required to report to SEC and the public. So we can't confirm anything without any SEC filings.

It's true they might be able to choose to go dark but they have to follow the process before they do so and that did not happen. So, going dark is not it.

They likely are being acquired and need to move to OTC fast which bypass the form requirement because the shareholders rights no longer need to be protected in a buyout and there is a quiet period following that.

If we don't approve of the transaction then they will file to SEC after the quiet period is over. That is likely the scenario here. Go and research this delisting process or even call SEC if you got questions.

Lol, better have some cash to average down on standby.

James, on Discord a group of investors was calling SEC for answers in regards to Delcath's recent action moving to OTC.

As mentioned going dark is a way for a small company to delist without breaking the bank. But, SEC regulations stated clearly the company must file form 15, then follow by form 25 to notify the public as well as SEC that Delcath was going dark and delisting.

So we heard the company coming out saying they are going to voluntary delist and will be filing form 25 and then trade on OTC 10 days later. You saw they came out saying so. Then within 24 hours they came out saying negotiations with OTC allows them to immediately relist. Don't you think there is a reason behind this move?

Think about this, they were going to follow the SEC rule to file form 25 then suddenly they are bypassing SEC laws? I think not. They have to be able to do so without violations and going dark is not it because they are required to file form 15 for going dark and meet all requirements on form 15.

Therefore, the conclusion is that they aren't going dark because no form 15 was filed. Which means M&A is a very high probability at this point. Otherwise, I don't see how they are just bypassing SEC regulations. Plus Delaware corporate laws governs Delcath.

We're still digging into the legal aspect to try and confirm. I mean, if this was going to BK, don't you think Ren, Vanguard, and even Hudson Bay would have bailed by now?

There are other smaller holders too. We did not see a sell off by any of those guys except Aryton Captial with their 40 million shares way back.

Well, shareholders owns the company. If you want to take it private, sell, merge what not, you need permissions from the owners of the company. Going private also qualifies as take over BO, since the new owner of the company is taking out Delcath to go private.

Something is not right here. The process to delist was that they have to announce that which they did with a PR that they would begin filling form 25 and then allow the 10 day requirement before being delisted and move to OTCB. That was the first PR. Then within 24 hours they basically said they could move this to OTC much faster totally by passing the SEC requirement. So that's called an accelerate delisting and it can be due to two reasons.

First is what's known as going dark since the delisting process can be expensive going dark is a way for company to save money. Also going dark does not require shareholder's approval. But, the company must not trigger any of the exchange acts below if they choose to go dark.

under Section 12(b) if it has shares listed on a national securities exchange;

under Section 12(g) based on having over 500 record holders of a class of securities and total assets exceeding $10 million3; and

under Section 15(d) by having a registration statement declared effective under the Securities Act.

So I don't believe Delcath was legally going dark here since they also have to file a form 15 as well as disclose the number of record share holders to the public.

The second is that the company is being taken private or being acquired. Then it would not be necessary to file form 25. It's Monday and we've seen no sec filing and even if they were going dark we should at least see a form 15. So there is something up at Delcath.

Pretty much, they don't need to worry about the listing requirements anymore. They can focus their energy else where on the company. More source just pointed out they are attending yet another medical conference which means they are trying to get exposure and network with people to potentially get some sort of strategics alliance deal.

Andrew, if RS was a yes, it would have been far worst. You're shares gets reduced, then the remaining convertible gets exchanged for 40 million warrants likely at a 1$ price post RS.

You're looking at your share likely reduce by 20x or more then drop by 50% or more in value. It would wipe out your entire stock value in no time.

James I wouldn't go make such accusation. There are usually people who knows about any deal being negotiated. If she turn down good offered, a lot of people won't be happy about it.

Apparently she also face difficulty with funding too. So she can only hold out so long before she needs some way to solve that funding problem.

OTCX, OTCB and the Pink. They are listing on OTCB and shorting is allowed just like any other exchanges as long as you can borrow the shares.

A while back I posted OTCB requirement and they are required to be reporting just like NASDAQ. So I really don't see being on OTCB as a bad thing. In fact, it probably made things a lot easier for Delcath since they don't need to be concerned with NASDAQ requirements and paying the big fees annually.

I don't know if it makes buyout any easier. The company share structure is still the same. All the series of preferred share, and shares outstanding are all the same as well as the maxed out 500 million authorized shares.

Everyone needs to know that they are simply trading in a different market.

Lol, I don't disagree there are groups with influences over this stock. Funny thing is there maybe more than one groups each with their own interest.

Obviously you got Delcath management and some institutions or the convertible notes holder trying very hard to get RS to pass. And they make big money if RS do pass.

And like Ddaurelio said, the public shot down RS 2x. Will a third attempt make any difference?

Funny thing is management diluted so badly there are boatload of shares out there that they have no control over. And, it's not as easy as just go and buy 40 million shares just to vote yes. That kind of buying will take careful planning and time to accumulate without rocketing the market triggering big runs.

Then you got Hudson Bay, Ren and Vanguard and few others holding sizable shares. What's on those guys minds? Tax write off at year end to take a 2.5 million loses? It would be interesting to see.

Interesting, that means Delcath Systems Inc actually owns Delcath Holdings Limited.

So what we're seeing is Delcath Inc selling asset to Delcath Holdings? Basically Delcath Inc using own money to buy own assets and put it under a different name? Sounds like they are trying to protect the asset. Doesn't make much sense still.

I had thought the same before, and they may attempt yet another RS vote. Like I said, they would have to find someone willing to help them buy it up big and vote yes. Obviously, it becomes difficult to buy large amount of SP was higher. In any case, they would likely need an exit after they bought the shares and have voting power. Sort of like Aryton Captial that some have speculated.

If that was the case, more pops are in order to create exits and possibly earn some profits. Help is not free. Delcath has to give something in return for those trying to influence the votes. While we're waiting just daily trades going on here.

I think they got even less this time percentage wise. I recall last vote was pretty close to passing. Would have to go look up their June filings.

Yes, filed 8k stating they only got 43% yes votes.

This part here I did not see any SEC filings on or around January 1, 2012. Not an expert in accounting but it's saying they sold some property to Delcath Holdings for 15.8 million but it was not immediately realized and so they put it as deffered gain until it's sold outside of the consolidate financial statements.

Then it said the remaining deffered gain on that sales is 4.4 and 6.7 million as of December 31 2016? Anyone with accounting background can shed some light on this?


“On January 1, 2012, Delcath Systems, Inc. sold a portion of its intellectual property to Delcath Holdings Limited resulting in a taxable gain of $15.8 million in the U.S. based on the fair market value of the intangible that was transferred. The arms-length price, which was determined in accordance with Section 482, is a significant accounting estimate. The gain is deferred under U.S. GAAP principles until the asset is sold outside of the consolidated financial statements. The remaining deferred gain on the intercompany sale of intangible assets is $4.4 million and $6.7 million as of December 31, 2016 and December 31, 2015, respectively.”

Yeah, is Delcath Inc partly owned by Delcath Limited? Or are they separate entities is the question.

Because, Simpson is basically selling technology to herself for funding. And that Delcath Limited has one shareholder we don't know who. It sounds like that one shareholder bought some asset from Delcath Inc.

Need to dig into what assets and patents are still currently owned by Delcath Inc. We know the notes holders have leans on Delcath asset because the asset was used to secure the 35 million funding last year. So, Delcath asset is definitely worth something.

But how much are still owned by Delcath Inc needs to be looked at.

Just the usual trading going on if anyone did not notice the patterns many times over in the last few months.

Pretty much. The whole thing with the first vote no and the run was that the current shareholders had enough. They were trying to force Delcath to do a deal instead of RS and dilute more for funding.

The second RS being voted no is exactly the same message to management. Only this time it's creating some fear due to being relisted on OTC.

Noticing the author didn't even consider BK as a potential outcome. Author was right about one thing, once you screw up and you attract all the shorts, and made yourself penny stock, it's going to be hard to get out of it because they are profiting off your stock. Much will be manipulated.

The point in the article was similar to my that Chemosat was effective treatment that they should be able to sell to a big player.

Yeah, inter company sales, question is what relationship is between Delcath Limited and Delcath Inc?

Leegy, the SEC doesn't govern how a corporation can RS. It's the state laws that governs the company and what they must do.

The state laws clearly stated that if you want to do an RS you need majority of shareholders approval. NASDAQ, SEC, OTC has nothing to do with that.

NASDAQ and OTC are just market exchange that facilitate the buying and selling. They have their own requirements for listing on the exchange but they are not law enforcers.

SEC is the law enforcers, they make sure the company follows the state laws and filing all events according to regulations.

Once the company pass the RS vote, it is the company that informs NASDAQ, OTC or the SEC that they are going to do an RS.

So get some reading online to learn a bit. They don't by pass the state laws trading a on a different exchange.

Not that easy. Shareholders are still shareholders. Doesn't matter if you go OTC or stay on NASDAQ it doesn't remove your rights to vote. The RH users still are owners of the company even though RH can't buy OTC stocks. They have every rights to vote.

They are going to OTCB, and there are regulations there too. It isn't unregulated. Delcath is still required to do a proxy for vote and report to SEC. If they can't get more than majority per Delaware laws, RS isn't happening. Going to a different exchange does not change Delaware laws!!

After all this time they got 43% to vote yes. Moving to OTC doesn't allow them to get around Delaware laws. Their only way is to get more institutions to buy, or find ways to persuade investors to vote yes.

This scare for going to OTC is going to create a good entry point for any one trying to help them out with the RS votes. But, if anyone or any institutions willing to help Delcath with the votes, they have to get something in return. They will play the stock some more. Watch for Hudson Bay and the others, see if they sell out.

They probably will file soon since they don't have to do it right at the moment. As you know the sec filings have been a bit slow but they always file on the last day. So they are going to OTC.

As I always said, they are out of funding and they got one on going phase 3 and another planned to start soon for the US FDA approval, but they are absolutely broke.

At the minimal, they need to renegotiate with the notes holders now that RS is a no. Depends if the notes holders are willing to bail them out they will be stuck with no options.

As was mentioned by CNA and the 10k they found. Delcath has their assets for sale.

The suitor obviously will want it cheap, but they may wait for BK sale. But, I doubt they go BK so easily it would really shows how bad the management is without any ability to get at least some funding to give them some breathing room for negotiations.

Either way, the company is at an end of the chapter. I would be surprised they can get some major funding to keep going with R&D. This was evident since last year when they had to resort to the 35 million convertible, and they still can't get new source of funding all this time. So someone to bail them out with cash infusion is unlikely.

That leaves the option of M&A or partnership to bring in that much needed funding. Or they would face BK as the last resort. Then, any longs would be at the mercy of science.

If science was great they will be multiple parties bidding for the asset. Although the starting bid would be cheap but who takes it home is another story when it comes to auction sales.

NCT02406508
First received: March 23, 2015
Last updated: July 25, 2017
Last verified: July 2017

This one, scroll down and you will see. This is catalyst due September. October the latest. If they was delay they would have updated it on July 25, 2017. This was a 3 year trial they are at reporting time.

Estimated Enrollment: 31
Study Start Date: October 2014
Estimated Study Completion Date: September 2017
Estimated Primary Completion Date: August 2017 (Final data collection date for primary outcome measure)

We're talking the read out of the trails. That information is not available yet. We don't know if that phase 2 hit the primary endpoints and it was a success or not.

Plus there was also a focused phase 3 on going and that was supposed to report interim safety readouts.

There are two trial reports they haven't revealed to us yet. If you look into those trials and in their filings. It was Delcath who stated they expect interim safety results 2h 2017 on the focused phase 3 and then the phase 2 has a completion date of September.

They updated the trial document end of July indicating no changes that the trial was going as planned. In any case, OTC or not doesn't matter.

They got two trial readouts we haven't seen yet. And they got their funding issue since they can't satisfy the obligations with the convertible notes.

They reported 1.8 million cash end of June. Means they have absolutely not much left to go on without a quick solution to their funding issue.

8k is out, 223.4 million voted for and 154 million voted no.

https://www.sec.gov/Archives/edgar/data/872912/000119312517283835/d340656d8k.htm

They got a substantial number of votes but was shy of getting majority only 43% yes. I wonder if they will try again and get more supporters to buy in now during the fear and relisting on OTC.

So maybe they propose yet again another RS vote. But, time isn't on their side. They face funding issue as they always have.

This was the trial result that many were waiting for. No doubt this data would be part of any negotiation and we would never hear from company about this.

https://clinicaltrials.gov/ct2/show/NCT02406508

It was last updated just in July and they were expecting the completion in September with a primary completion date in August. This trial was done.

My guess is we get turbulence due to the relisting in OTC where they get the bad news out of the way.

Then they will release this trial result as well as solution to their funding issue.

If we hear absolutely nothing about this trial result, it is likely they have non disclosure agreement and a deal is in the work.

This is material event and must be reported to SEC and public unless they can legally withhold this due to legitimate reasons.

Sam, you are obviously new to SEC laws. Company officers and executives cannot buy shares during a negotiation period. That's called trading on inside information and they can face big fines.

Especially when a deal is close, Simpson can't buy any shares.