RE:RE:RE:RE:RE:RE:RE:RE:New Filing todayThe chances of an adjusted EBITDA breech seem low, but if it did happen I suspect that would open the door for MArathon to come in and grab the assets. I am not sure what recourse THTX might have in such a situation. Previously, the best way for Marathon to get their cash back was to renegotiate the loan after a breech, earn some extra fees and then let THTX run its business to generate teh needed cah. With $60 million in loans outstnading and around $48 million in cash on the balance sheet right now, the way Marathon may look at another breech, should it even happen, may be diffferent. For example, if there are good results on cancer recently reported, then taking the company's assets versus renegotiating might produce a bonanza for Marathon.
It is worth remembering that Marathon likely cares less about shareholders interests than the board of THTX does. So, I am wondering what PWIB, who has some experience in this area, might think about this admittedly remote risk.
Mannequin wrote: So does that mean that you do not believe that missing the EBITDA can create a situation where a marathon can come in and scoop the whole company?
SPCEO1 wrote: As you might imagine the circumstances are really not conducive to a good conversation between THTX management and myself. I seem to have run out of "other cheeks" to turn towards them at this point (see Luke 6:29 - "
If someone slaps you on one cheek, turn to them the other also). But I wish them the best and hope that, despite what they have done to legacy shareholders, that TH-1902 will succeed well beyond everyone's wildest dreams and this whole sorry situation can be redeemed.
Mannequin wrote: considering this possibility, I would like to suggest that you send them a letter outlining the question and what the solution to this possibility is? We can't just leave it to somebody on the forum and you are the best person to ask this question and get clarification.
SPCEO1 wrote: What if TH-1902's results look good while THTX simultaneously violates the Adjsuted EBITDA covenant? Might Marathon want to take the assets in that situation? Can THTX prevent them from doing so? I am not sure but PWIB has some related experience and might know the answer to that. I imagine IQ would come to the rescue again if that happened with the additional needed money but I am not sure how such covenant breaches actually work. If Marathon wanted the assets, could they get them even if IQ was willing to come to the rescue with more cash? And if IQ had to come to the rescue again, what percent of the company would legacy shareholders be left with after that? This is THTX remember, so you have to assume any crazy possibility might have a chance of happening! And the extra cash on the balance sheet is not going to help them dodge the adjusted EBITDA test, so there is some risk of yet another covenant breach.
Trogarzon wrote: What are you saying here. Should Thera breach their covenants again on some other parameter than the cash level, Thera would pay them off and get the balance somewhere else.