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Delcath Systems, Inc. (OTCMKTS:DCTH) Releases Letter To Shareholders

Delcath Systems Inc.

Delcath Systems, Inc. (OTCMKTS:DCTH) reported that Jennifer K. Simpson, Ph.D., the CEO and President has released a Letter to Stockholders offering a business update and motive behind the firm’s recent measures to preserve capital access. It explained the steps that the company has been taking to restore its access to capital so that it can continue to grow business and the clinical plans on which shareholder value relies.

The details

As previously reported, Delcath recently reported the listing process for its common stock on the OTCQB platform. As an outcome of shareholder non-approval of company’s proposed reverse stock split, the company could not regain compliance with the sustained listing guidelines on the Nasdaq Capital Market.

After discussions with both OTC and Nasdaq Markets, as an outcome of company no longer being able to fulfill the continued listing needs, the change in listing to the OTC platform was impacted without the requirement to submit a Form 25 and more quickly than expected.

Since the equity split proposal did not accomplish the level of shareholder support needed under Delaware law for passage, the underlying issue of authorized share limit remains. This makes the firm unable to use the restricted cash otherwise accessible under the 2016 convertible notes or to follow new equity financing. Unless and until company can make authorized shares offered and thus access capital, it doesn’t possess the ability to support its operations and continue business beyond the upcoming few months.

Thus, they have concluded a deal with the 2016 convertible note holders that will solve the authorized shares limit issue. This deal offers for the issuance of Series ‘C’ preferred shares in lieu for $0.5 million in cash, offering them with required cash to continue their businesses in the short term and offering the convertible note holders with improved voting rights sufficient to permit a reverse stock split.

Published by Van Bettauer

Van Bettauer is a financial aficionado from Vancouver, British Columbia. He currently studies at UBC, pursuing a Bachelors of Science degree. Van has been freelance writing for many years, specializing in copywriting, report writing and article writing. The combination of his scientific studies and writing experience brings a new and fresh perspective to the financial world. Visit Bettauer's Google+ page at the following address:

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