Our Latest Announcement and 8-K
We have been getting questions from shareholders about the financing agreement we announced on Monday with a news release and a detailed 8-K filing. If you have not taken the time to read the 8-K, you should do so.
First, let me say that the securities regulations are pretty strict about what we can and cannot say during the next month. So I am limited, for now, in the details I can give in answer to your questions and what I can say about the company’s plans.
In that context, here is some information that might be helpful to you in understanding what this announcement means.
Who are the people providing the company the money? If you look at the exhibits filed with the 8-K, you will see that the agreement is signed for Vatea Fund by Gregory Pepin. Then, if you go to the website Seekingalpha.com and do a search on his name, you will find several articles he has written on investing and you will see his public profile, which says Gregory Pepin is Senior Vice President of a wealth management company in Switzerland.
What does this deal mean? On July 10, Vatea Fund has agreed to pay us $5 million for 20 million shares of our restricted common stock. Then, depending on events and whether the company achieves certain product milestones, they would end up providing us with up to an other $15 million in cash.
Some have asked why we are doing this deal. Again, I am referring to the 8k statement as filed. If you read our periodic public filings with the SEC, you will know that we have said in those filings that we will need additional funds to finance our planned product development activities.
We will use cash from the first tranche of $5 million partly to fund the warrant exchange offer. While I don’t know and won’t guess how many warrants, if any, will be offered to us for exchange, I do expect that the exchange will leave us with cash in the bank that we can use for our business needs and product pipeline.
Well, this apparently is all the freedom of speech I have here. Bear with me, I’ll be much more open as soon as securities regulations allow me to be myself again.