A. Fund raising. The company raised cash proceeds of $5.2 million in 2013 (see Subsequent Events of page F-33):
- $2.6MM at year-end 2012 placed by Network 1, common stock priced at 75 cents (the share around the time may have been in the $0.50s), 1-for-1 5-year warrants struck at $1.00, and
- $2.6MM in February 2013 also placed by Network 1, convertible preferred stock at 75 cents, 1.25-for-1 warrants struck at $1.00.
B. Preferred Stock. The figure at 12/31/12 was 2.5MM shares. At 9/30/12 it was 2.9MM. I think this security, aside from what was issued in February, could be near or at zero at 3/31/13, as these holdings have been or are being converted this quarter (trading volume has been very heavy).
C. Lawsuit. There is a [presumably] shareholder lawsuit (see Legal Proceedings on page 21): "The Shareholder Derivative Complaint alleges (i) breach of fiduciary duties, (ii) waste of corporate assets, and (iii) unjust enrichment, all three claims based on the Plaintiff’s allegations that the defendants authorized and/or accepted stock option awards in violation of the terms of the Company’s 2002 Stock Plan (the “Plan”) by issuing stock options in excess of the amounts authorized under the Plan and delegated to defendant H. Craig Dees the sole authority to grant himself and other executive officers of the Company cash bonuses that the Plaintiff alleges to be excessive."
D. Warrants. A warrant reset related to the where the share price was in relation to the strike prices of certain warrants resulted in the issuance of 3.8MM 3-year warrants struck at $0.68 (see page F-26).
E. Regional licenses. In the last 10Q, the company wrote: "We are seeking to improve our cash flow through both the licensure of PH-10 on the basis of our Phase 2 atopic dermatitis and psoriasis results, and the geographic licensure of PV-10 on the basis of our Phase 2 metastatic melanoma and Phase 1 liver results in certain areas of the world, as well as pursuing a strategic investment strategy, including equity sales to potential pharmaceutical and or biotech partners, and continuing with the majority stake asset sale and licensure of our OTC products as well as other non-core assets."
In the 10K, Provectus wrote: "We are seeking to improve our cash flow through both the licensure of PH-10 on the basis of our Phase 2 atopic dermatitis and psoriasis results, and the geographic licensure of PV-10 on the basis of our Phase 2 metastatic melanoma and Phase 1 liver results in certain areas of the world, as well as pursuing a strategic investment strategy, including equity sales to potential pharmaceutical and or biotech partners, and continuing with the majority stake asset sale and licensure of our OTC products as well as other non-core assets. The geographic areas of interest for PV-10 principally include China, India, Japan and Middle East and North Africa (MENA)."
I will watch closely for information and/or PRs related to this item next week.
F. Placement Agreements. Also in Subsequent Events: "The Company entered into a Placement Agent’s Agreement dated March 11, 2013, with Network 1 Financial Securities, Inc. (“Network 1”) as placement agent, which allows for the sale of the Company’s common stock at a purchase price of $0.75 per share and 100% warrant coverage to purchase shares of common stock at an exercise price of $1.00 per share."
According to Peter, it was necessary to have an "open placement agent agreement" as a placeholder for BDO's going concern opinion. The placement agreement with Network 1 appears to be viewed by BDO much like it views the Lincoln Park equity line of credit agreement.
G. Global license. In the 10K, in addition to expanded and more specific language on regional PV-10 licenses, the company also added language on global PV-10 licensure: "We are also considering the global licensure of PV-10 as well since it has come to our attention that this is of interest to potential partners."
I do not think this refers to Pfizer, but rather several other competitors (at least 2 American and 2 European Big Pharma companies) including one in particular that continues to do clinical due diligence, but may well have wrapped up its business diligence.