Delcath Issues Letter to Stockholders
I write to reiterate our recommendation for shareholders to approve the proposed reverse stock split as outlined in our Schedule 14A filed on
A vote FOR the Proposal will result in the following:
- Extinguishment of the note with the majority Note Holder
- Adjust the floor price for the remaining note with the minority noteholder to a minimum of
$1.00as required by NASDAQ
- Position the Company to solve the minimum bid requirement for NASDAQ
- Allow the Company access to capital by decreasing the number of Authorized shares outstanding
As stated in the Schedule 14A, the proposed reverse stock is for a ratio range between 1 for 20 and 1 for 500, at the discretion of the Board of Directors. The ratio range is designed to provide the Board with maximum flexibility in order to be able to adequately address two main issues that currently limit the Company’s access to capital.
- Authorized Shares Limit.
Delcathis currently at the threshold of the Authorized Shares limit in our Certificate of Incorporation. Without the ability to issue new authorized shares, we are unable to access the restricted cash account associated with our Convertible Notes, or undertake any type of equity financing.
- NASDAQ Compliance.
Delcathis currently not in compliance with NASDAQ minimum bid price requirements, and as disclosed recently is not eligible for another six-month extension due to an issue related to required shareholder equity accounting of its Convertible Notes.
Should the Company not obtain approval for a reverse stock split, it is likely that the Company will be delisted from NASDAQ. We believe remaining on the NASDAQ provides liquidity and other benefits to the Company and its investors.
To mitigate potential future dilution following a reverse split, we recently concluded an agreement with the majority holder of the Convertible Notes by which 90% of the outstanding debt related to the Notes will be extinguished upon shareholder approval of the reverse split proposal. Additionally, the floor price of
The proposed reverse split of our common shares will reduce the shares outstanding and provide us with the flexibility to raise equity capital to invest in our Clinical Development Program our commercial efforts in
For these reasons, we believe the proposed reverse stock split is in the best long-term interest of shareholders, and on behalf of Delcath’s management team and Board of Directors, I am seeking your support by voting FOR the reverse stock split so we can continue to build
President and Chief Executive Officer
Voting Instructions. All stockholders as of the July 13, 2017 record date can submit consents, even if they have subsequently sold their shares, and the Company encourages stockholders to do so before September 6, 2017 at 11:59 p.m. Eastern Time. Stockholders are reminded that their vote is extremely important and are urged to complete, sign, date and mail the consent card at their earliest convenience. Any stockholder who would like to vote by telephone may call 877-777-8133 or online by visiting www.proxyvote.com.
YOUR PARTICIPATION IS IMPORTANT - PLEASE VOTE TODAY!
Forward Looking Statements
Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by the Company or on its behalf. This news release contains forward-looking statements, which are subject to certain risks and uncertainties that can cause actual results to differ materially from those described. Factors that may cause such differences include, but are not limited to, uncertainties relating to: the timing and results of the Company’s clinical trials including without limitation the OM and ICC clinical trial programs, timely enrollment and treatment of patients in the global Phase 3 OM clinical trial, IRB or ethics committee clearance of the Phase 3 OM and ICC Registration trial protocols from participating sites and the timing of site activation and subject enrollment in each trial, the impact of the presentations at major medical conferences and future clinical results consistent with the data presented, approval of Individual Funding Requests for reimbursement of the CHEMOSAT procedure, the impact, if any of ZE reimbursement on potential CHEMOSAT product use and sales in
Scott GordonPresident - CoreIR Email: firstname.lastname@example.org