Creative Medical Technology Holdings Inc (CELZ)

[WinInLife]

I agree with you to some extent but I’m going to chime in now that you bring up the topic of potential dilution.

I’ve been reading a few posts that bring up the subject of dilution. I want to bring up and clarify what CMTH’s intentions are according to their own latest 10-Q which I have dissected several times and what a CEO can and can’t do when it comes to dilution.

Here is a quote from the 10-Q under the Management Discussion section.

“Going forward, our short-term funding needs are expected to be satisfied by funds to be loaned to us by third parties and revenues generated from our Caverstem ED procedure.”

There are a few things to call out here:

Short Term - means in the immediate future. They are stating that in the near future they expect to get additional funds from:

1) Loans

2) Revenues from CaverStem


This is good news because they are now officially stating that they expect CaverStem to generate revenues to fund their operations and research. Given all the things they have in the pipelines it’s likely that they will need additional cash to fund R&D and commercialization of the other procedures they are working on. They expect to get additional funding through loans. Unless you are someone that’s able to go in life paying cash for everything you own (cars, houses, etc...) then you know getting loans is a necessity for individuals and for businesses.

This is totally fine by me. This is (in my opinion) a wise way to spend / invest their funds as they continue to build a NASDAQ worthy company. The key to every successful business is to reinvest their earnings and efficiently use the proceeds of any loan as they grow their business. Anyone in business would easily understand.

Note that CMTH did not say they needed to dilute in the short term. They might in the future as they continue with their aggressive growth plans. I only expect some minor dilution from convertible notes that are near maturity.

So enough of this dilution thing being taken as the Armageddon of this company! These guys are on a mission.

The other thing I want to clarify is the idea that a CEO can dilute behind our backs. That is simply not true.

I’m a company executive for a corporation. I have stock options and own RSUs (restricted stock units). I can’t just go and sell my shares in the open market. I’m restricted by the Insider Trading regulations that govern these kind of transactions. These regulations also apply to anyone in the company that own stocks.

We have predetermined trading windows. The only time we are able to sell our shares is 3 full trading days after the company releases the quarterly numbers to the public. The trading window closes 30 days before the end of the next quarter.

Now think about what I stated above and look at CELZ. The previous quarterly results were released in mid-April. You knew that Tim had “x” amount of shares back then. He could have cashed out a few back in April and May and he did not. Why do I know that? Because when they released the recent share structure report a week ago he still had the same shares he had back in April. He can’t cash out at this time because the trading window is closed. He can’t until 3 full days after they release the 2nd quarter numbers in August.

The GOOD news is that Tim did not cash out his stocks when he had the chance. You can only assume that he is also holding for when the stock value goes higher or he doesn’t need to cash out at this time. I believe (my opinion of course) that if he knew things would go downhill he would have cashed out some of his stocks (and he has plenty!)

So if the CEO dilutes we will know right away through SEC filings and I hope you now know when is it that he would be able to do so (trading window). There are ZERO signs of intentions to dilute for personal gains. ZERO!

Just wanted to bring up some clarity to the dreaded word “dilution” in CELZ. It is insignificant at this time. Zero worries.

Peeps - We are golden here. I’m not cheerleading CELZ but I can’t hide my enthusiasm in seeing wise use of financial resources as the company continues to march forward. As a business executive and accountant I’m happy with what I’m seeing from a management standpoint. I’m even more excited about the performance of our investment here and the huge potential it has in the short and long term.

Looking forward to 9:30am tomorrow!!!!