March 9, 2016 9:03am
VCEL has entered into a $5 M term loan and a $10 M short term loan agreement/revolving line of credit agreement with Silicon Valley Bank, providing access to up to $15 M.
VCEL has to keep the doors open … with more debt the only option.
VCEL ended Q3/15 with $18.72 M in cash and $81 K in debt with Q4/15 spending to be yet “illuminated”. The real question is the amount of the ATM utilization through these periods.
VCEL will announce financial results/earnings or its LPS <loss per share> numbers on 3/14/16
The Bottom Line: With access to capital market financing non-existent, where ... else can cash starved companies go for furtherance of their “runways”? The problem is the cost of borrowing and the “tacking on” of warrant “sweeteners” for the lenders put shareholders at further risk from onerous “overhang” exposure.
In one way it is a positive as cash to operate is extended; VCEL is not the only company caught in this vise.
VCEL closed at $2.10 on Tuesday, 3/8/16
