Full Press Release Details
Amro Albanna (00:00):
Jeff, we can get started.
Jeff Ramson (00:02):
Amro Albanna (00:03):
Well, first of all, Jeff, thank you very much for doing this. I really
appreciate you agreeing to do this. What we plan to do more often, so that way our stakeholders understand where we're going, what's going
on with the company, and the whole objective here is to really provide some clarity to our direction. And I really couldn't find a better
person, especially for this first one because you do understand the company. You've been with us, you've been involved with us for some
time right now, and you are an investor yourself. You've been on Wall Street and you are also in investor relations, so you do understand
how retail institutional investors think. And I thought it would be great idea for us to have a conversation and cover the questions that
came through the email and some of the questions that I'm seeing online. So thanks again, Jeff. Welcome. And we'll go from there. Maybe
you can just give a quick background introduction on yourself, your involvement with aditXt, and we'll take it from there.
Jeff Ramson (01:08):
Sure, sure. Happy to Amro. Thanks for having me and thanks everyone
for joining. So I'm Jeff Ramson. I am CEO of PCG Advisory. We're a full service investor relations firm based in New York. I also manage
a fund where we do invest a good amount of our allocation into microcap and small cap companies. I met Amro maybe six or seven years ago,
and I was actually an early investor in the company when it was private. I remained as an investor in the company after it was public
for quite a number of years. We also worked together for a number of years, Amro, in the beginning after your IPO. So I do know the company
well and I know what it's like from kind of all sides of this equation, from being an investor, being an investor relations professional.
And I think I can hopefully represent what investors are looking for and would love to get out of this conversation.
Amro Albanna (02:04):
That'd be great, Jeff. And look, I mean, I know there were quite a
few questions that came around the same topic, so maybe we can address those right away and then we can dig into the business. What is
really aditXt? What is our business? What infliction points are we looking at? And frankly, some of the challenges that we, and how we
plan to address some of those challenges. So to start with, I think at least one of the questions that came through is related to NASDAQ
compliance. And I think there's some misconception as far as dipping below a dollar in a 10 day period that will cause immediate delisting.
That is not the case at all typically, and we're not below a dollar number one, and we do have an 8K filed, which details the whole compliance
situation with NASDAQ, but right now we're not below a dollar and dipping below a dollar in a 10 day period will not cause NASDAQ delisting,
automatic NASDAQ delisting, right? There is 180 day period where you can fix it. So I want to make sure that at least start with that.
That is not an immediate issue for the company.
The second piece too, that we will discuss in more details, I think
there was some confusion about our prospectus supplement filing Monday that is not a new equity line. We had an equity line, an agreement
that was signed. We had an S3 and an S1 already filed already effective with the SEC online. And what we did Monday was moving the equity
line to where the existing S3 provides the underlying shares. It was not a new equity line, it was an existing equity line, and we simply
shifted that to the existing S3 to provide the underlying shares. And again, we'll talk a little bit more about capital. Look, as a young
company, as a microcap company, we must have the fuel to be able to fly. That's just a fact. And we'll talk a little bit about the concept
of dilution, what it means and what it means to investors in the midterm and the long term. So I just wanted to get these couple pieces
out first. And in fact, I will add one more, one more data point.
Again, microcap company we're not profitable. We have to have
access to capital efficiently. That's just a fact. That's a fact of life. That's a fact of microcap companies. And the alternative is
either go out of business, which is not an alternative any stakeholder would want, obviously. To date, I believe, just to give a percentage
out of the volume, since we had the ELOC effective, out of the total volume, I believe it was 5.4% that we used from the total volume
that was traded for aditXt, that's a very, very small volume. Now, I do understand that there is a lot of pressure on the stock there.
Trust me, we want to know what's going on. You get up every day, you end the day and there's constant pressure on the stock. So it's something
that we also want to know because we keep moving the business forward, but we also have to deal with the pressure on the stock. And that's
why frankly, Jeff, you and I are working together to really begin figuring out how we can support the stock and provide that message with
clarity to our stakeholders. We do have a great business here that must move forward.
Jeff Ramson (05:56):
Agreed, agreed. And listen, I do give you a lot of credit Amro, and
I'm not just saying this for taking this approach to dealing with communications with shareholders, right? It is a challenging situation.
It's a little complex. So the clarity helps people sort out the information so they can make the proper decisions given what you just
said. One thing I think that came through in a lot of the questions was maybe you can clarify the share count, I'm sorry, post reverse
split and maybe some of the facts around that.
Amro Albanna (06:32):
Yeah, sure. So our current outstanding number of shares, and we did
put it in filings. We sent NASDAQ the forms to update the number of shares. It is roughly 4.7 million shares right now. And immediately
after the reverse split was 244,000. And we had couple events, obviously one we're raising the capital using the equity line, but that's
a very small percentage. Again, 5.4%, 5.7% of the total volume. And number two, we had some conversions. We have existing preferred shareholders
that converted and we had to issue common for them. So that was the result of these two issuances. But I would say, Jeff, again, you're
an expert. You're in the market every single day without, with other companies, still a small outstanding number of shares given the business
and what we're trying to accomplish and given the capital needs, frankly, and the conditions of the market.
Jeff Ramson (07:37):
Right. Agreed. Agreed. So I think what, as far as capital markets go,
I think one of the theme, a lot of the questions is how will you continue to fund the company and how do you make these acquisitions?
And I don't want to overstep the vision for the company, whichever order you want to go, but I think maybe this is a good way to start.
Just maybe talk about how do you plan to complete these acquisitions.
Amro Albanna (08:09):
Right. So look, it is a balancing act that is more challenging in tougher
market conditions. So two, three years ago, raising money, the terms were a lot easier on the issuer. Again, that's a fact. As markets
became more challenging, it's become that much more challenging for companies to raise money. But let me tell you what it is. Ultimately,
aditXt as a company, the health of the company and the growth and the future of the company will depend on three factors. Number one,
a business. We have to have a business, we have to have a future. And we'll talk a little bit more about that, Jeff, as far as Adimune
program, as far as the Pearsanta program, as far as the two potential acquisitions, Appili and Evofem. But that is the business
and that's how we see creating value in 2025, 26, 27 and beyond. That's number one.
So do we have a business, and I believe wholeheartedly, this is a solid
business position for growth. Number two, we have to address the overhang, overhang on our cap table, whether it's preferred overhang,
in terms of payables, overhang in terms of notes and debt, we have to address that. And we are working deliberately as we speak on cleaning
up the overhang to improve the health of the company. And finally, number three, which is a must. You have to be able to access capital
efficiently. At least you have to be able to access capital. And the goal here is to access it efficiently. So few months ago we filed
for a shelf, it's a shelf registration. Now we have access to it, and our audience can go online, they can look at all the dates, the
filings, all the stuff that's out there. But it provides us the ability to access capital timely and efficiently because a company, again,
that is not making profit, has to have that capital to grow. If we don't, there is no business. But we positioned ourselves again to have
an equity line and a shelf to be able to access the capital again in timely manner so we can support and finance our growth.
Jeff Ramson (10:34):
Agreed. Agreed. Do you want to talk a bit about the preferred structures
and maybe the relationship with some of those investors? Because I think that might be important for people to understand.
Amro Albanna (10:45):
Yeah, look, and Jeff, as part of our introduction, I should have actually
said, look, you and I talked yesterday. Obviously we talk all the time. And I said, don't shy away from any question, whether it's a question
that came through or a question that you have. It doesn't matter how difficult the question is, we want to make sure people understand
what is the opportunity, what are the challenges, what are we doing about it? So a big part of our preferred came as part of the Evofem
transaction. That's number one. Another part of our preferred came as part of the prior transactions with Brain Scientific almost a year
ago. And then a third group of preferred came because we raised some money since last December. So those exist. So we as a company, and
there are all kinds of legal conditions, but in general there are some that will require shareholder votes, some that will require registrations,
some that we have the rights to redeem.
But ultimately from our shareholders' point of view and future shareholders'
point of view, we are looking to streamline our cap table. So it just becomes common. Again, it's not today, it's not tomorrow. But that's
something that we started and we've made pretty good progress and we're working very closely with the holders to understand where the
company's going and a plan to basically redeem those preferred, again, it's not today, it's not tomorrow. It is a plan, but our goal here
is to address our cap table. I mean, look, it's not that complicated, but it's something that needs to be addressed, certainly in my view.