In a nutshell and my reading of it:
They sold 3,747,558 common stock and diluted with options to potentially dilute 3,747,558 more shares. 7,495,116 total potentially when all is said and done.
3,747,558 will happen 12/22.
1,873,779 will be available for 18 months beginining 180 days from 12/22.
1,873,779 will be available for 5 years begining 180 days from 12/22.
That is bad news because if all potential shares are sold, there will be around 40% more shares on the market provided that 18+ million shares outstanding is accurate on Scottrade.
It may or may not bounce back. The options would lead one to believe that they are hoping the stock goes above 2.45 making it viable for the "institutional investors" to execute the potential warrants with the time limits.
From the looks of it and just on the surface, it appears they do not currently produce any product and is working on the 3 products from its recent aquisition of Torry Pines to come to fruitation and generate revenues and perhaps profits. While those are in developement, the moneys to pay salaries has to come from somewhere and now you are seeing where it is coming from.
I do not know how many phases are in clinical trials and how long from that processes(s) they will need to get FDA approval etc. etc. That would require a significant more amount of research.
Your are basically waging a bet for an indefinite amount of time that product will be produced and generate enough profits for your investment to profit.
Companies that actually lose money year after year can still equal profits in trading thier stock, so you really never know with these things. All you can do is research, research, research and hope, pray, flip a coin....whatever you feel most confortable with, but at the end of the day you should be prepared to lose it all for any stock you invest in.
Regards,
Fizzlegig
