BTIM: BioTime

BTIM: May 11, 2009: Is it time for BioTime
BTIM: May 13,2009: Products for Stem cell Research
BTIM: Aug 18,2009: iPS Patent List

BTIM: Products for Stem Cell Research

The following are some of the products that are being sold by BioTime for stem cell research.

- Embryome Database: Detailed map of the human and mouse embryome to permit the researchers to chart the cell lineage of human development, the genes expressed in those cell types and antigens present in the cell surface can be used in purification. The database is available in www.embryome.com

- ESpan Cell Growth Media: BioTime/Embryome Sciences will market cell growth media product. These growth media cell types are optimized for growth of primitive embryonic progenitor cell types for laboratory settings as well as commercial sector. BioTime expects that the manufacturers/researchers instead of propogating hES cells in large quantities will instead propogate cells using media optimized for the propogation of embryonic progenitor cells created from hES cells.

- ESpy Cell Lines: ESpy product lines will be developed with Lifeline (ISCO) using ACTCellerate technology licensed from Advance Cell Technology Inc. ESpy cell lines would be derivatives of hES cells that send beacons of light in response to the activation of perticular genes.

- Other New Products: BioTime is also planning to bring other new growth and differentiation factors and kits which will permit researchers to manufacture specific cell types from embryonic stem cells and also market purification tools useful to researchers in the quality control of products for regenerative medicine.

My Take: Company is all set to storm the research market with products which are the best in the breed (based on BioTime's vast experience). They have already identified the tools and critical products and have licensed the same from the actual product vendors. These tools are already being used in the research field and with these agreements the product pricing would be consistent. Standards will be set and once the critical level of acceptance they will be the coke and pepsi of the stem cell research world.

The following statement Sums up BioTime's Strategy:
We are focusing our current efforts in the regenerative medicine field on the development and sale of advanced human stem cell products and technology that can be used by researchers at universities and other institutions, at companies in the bioscience and biopharmaceutical industries, and at other companies that provide research products to companies in those industries. These research-only markets generally can be marketed without regulatory (FDA) approval, and are therefore relatively near-term business opportunities when compared to therapeutic products.

PN: These are my personal views from publicly available info about BioTime

BTIM: Is it Time for BioTime

BioTime http://www.biotimeinc.com/ is a california based biotech company with established products in the "plasma expanders" market "Hextend". These plasma expanders are used in high blood loss surgery. Hextend is approved for major surgeries and is distributed in US and Canada by "Hospira" http://www.hospira.com/ and in south Korea by CJ Corporation. (1.2 million USD royalty payment year ending Dec 2008 from Hospira for Hextend). Hextend is also going to be licensed to Summit Pharmaceuticals International/ Maruishi Pharmaceutical for Japan, China & Tiwan.

BioTime also has other products such as "PentaLyte" (Phase II Trial completed), HetaCool all part of the "plasma expander" family of products for specialised conditions.

BioTime through its wholly owned subsidiary "Embryome Sciences Inc" is entering into emerging field of "regenerative medicine". Embryome Sciences plan is to provide advanced stem cell technologies related research products and services to the research companies/institutions.

(I must state that Embryome and BioTime have been working on developing Embryonic stem cells from a non controversial source)

- Embryome Sciences will provide and maintain a commercial database (website) that provides the first detailed map of the embryome, aiding researchers in identifying many hundreds of cell types comming from embryonic stem cells. The new website will also be used to market the stem cell research products developed by Embryome Sciences and other companies.
- Embryome Sciences will also market products (growth & differentiating factors) researchers need to induce the cells to become desired cell types. these products are also available for sale on the website since June 2008.
- Embryome Science will sell purification tools usefull to researchers in purification and quality control analysis of products in regenerative medicine.

Ticker symbol: BTIM
Company Name: BioTime
CMP: 2.05 USD Market Cap: 52.95 million USD

My take: BioTime is really trying to be in the front and center of embryonic stem cell related development. Setting up the market place where people (research companies and institutes) will go to buy raw products and sell the finished products(hopefully).
It is trying to be the facilitator of all future developments in embryonic stem cell field.
It has acquired key technologies licenses which will then be sold/marketed to research firms.
It has acquired key technologies to induce growth of the desired cell types.
It is using a non controversial way to build stem cells using somatic cells. (Process is called induced pluripotent stem cells - iPS)
Dr. West who has worked on telomere extension (telemorase - Geron Corp www.Geron.com ) and with ACTC (Advance Cell Technology) as per my understanding is simplifying the stem cell technology through BioTime - Embryome Sciences initiative. Dr. West and his team are effectively going to provide the basic plumbing required for research groups to kick start their research in Stem cell field.

Just like the Internet before and after the web browser is a completely different story.
This collaboration initiative will bring stem cell research to prime time. BioTime - Embryome Sciences success will depend on how popular the site and its tools/services become. They need to strike a fine balance of freedom and control to see the site and volume of business to grow.

Considering the lineage of BioTime (Dr West) I would give more than a 50-50 chance for the company to hit big time. This is a good time to get in.

Interesting Read:
- Life Extension Magazine: Will BioTime reset the clock of Aging: Regenerative Medicine breakthrough
- BioTime Company Website

SRZ: May 4, Sunrise Announces Overhead Cost Reduction/Downsizing Plan and German Community Sale!!.

SRZ has made an 8k filing with regards to downsizing.



- Eliminating 150 positions which would save 20 million in annual recurring expenses.
- Downsizing would help SRZ's centrally administered services expenses would be reduced by approximately $1.5 million.
- Richard Nadeau employment is terminated for "other than for Cause" Richard will receive 2 years base salary + 75% of target bonus + accelerated vesting of Mr Nadeau's unvested equity awards.
- April 29 & April 30, 2009 SRZ entered into standstill agreement with lenders of 7 German communities and Hoesel land.

• SRZ also entered into standstill agreement with NATIXIS London branch with respect to Sunrise Hannover, Munich and Konigstein communities untill the earliest of occurance of certain events related to loan or May 31,2009.
• SRZ also entered into standstill agreement with Capmark Finance Inc with respect to Sunrise Villa Camphausen, Reinbeck, Oberursel and Frankfurt communities until occurance of certain events relating to loan or May 31,2009.
• SRZ entered into standstill agreement with HSH Nordbank AG with respect to Sunrise land in Hoesel until Sept 30,2009 unless revoked by HSH Nordbank upon certain events, which revocation would be effective on June 30,2009.
• SRZ entered into standstill agreement with Barclays Bank PLC remain in effect until the occurance of certain events related to the loans or June 30,2009.

My views: Its a good package for Richard for sure. It does help SRZ in some ways as the option expenses can be done at the now low price of $2.70 instead of the 1 year down the line SRZ stock price of $ 5-10.
Elimination of 150 posts will result in reduction of overhead expenses of non consolidated communities and make the communities profitable (hopefully) which would also help as SRZ would not have to invest in performance guarantee.
- SRZ has entered into standstill agreements with lenders of German communities. SRZ has stated in previous news releases its intention of sale of german assets. This 8k filing gives us an indication of timelines of the said sales. Most of these asset sales are by May 31,2009 through June 30,2009. So we should hear more news updates from SRZ about these asset sales. [Quite possible that there is no public announcement just like there has been no public announcement of the sale of 10% stake in UK communities for a profit of 19 million in Q1 2009]
Richard Nadeau will be leaving by June 15,2009 so most of these deals should be complete by June 15,2009.
Goodbye Richard!.. Thanks for all the help, last but not the least enjoy the millions for all the hardwork and bringing SRZ back to ship shape. You earned it!!
PN: These are my interpretation of the information available in the 8k filing. Original 8k filing document is available here

SRZ:May 8, Clarification regards Foxhill assisted living and condominium project

Fox Hill Assisted Living and Condominium project is a Sunrise Senior Living Community. In the earnings call there were some questions raised with regards to Sunrise Fox hill community and hence this 8k filing.

Following are some salient points.
- Foxhill is a new Sunrise community located in Bethesda Maryland which is still under construction/development phase.
- The Fox Hill community loan agreement and budget provide for the lender to fund construction costs and operating and interest shortfalls during the lease up and condominium sale period. If the lenders ceases to fund the load agreement, SRZ would have to incur additional obligations in connection with Fox hill.
- SRZ has provided project completion guarantee to the lenders. Construction of FoxHill is substantially complete but there are unpaid invoices of approximately 3 million. The company has paid approximately $ 51.1million in cost overruns under the project completion guarantee.
- SRZ has also provided an operating deficit guarantee to the lenders on the assisted living amenities portion of Fox hill to fund operating shortfalls and interest payments to the extent they exceed the amounts in the Fox Hill budget
- SRZ has provided an operating deficit guarantee to the condominium venture to fund cash shortfalls defined as interest on loan, real estate taxes, condominium assessment and any other expenses in excess of reserves established to pay such expenses in the Fox Hill budget.

My Views: There seems to be some difference of opinion between SRZ and the lenders. SRZ is of the view that there are legitimate invoices of 3 million which are unpaid by the lenders. SRZ has funded the project with additional $51.1 million in cost overruns under project guarantee.

Another point to be made is that 51.1 million in cost overruns are considered as subordinate debt. Subordinate to the debt taken for funding the project but paid before the owners are paid for their investment. This is the standard for all sunrise development projects.

I think this is part and parcel of being in the assisted living community development field and not an abnormal situation. The credit crisis would have caused the lenders to be more tight fisted but this is part and parcel of doing business where there are differences of opinion. there is a possibility that SRZ might have to make additional investment to see the project to completion.

PN: These are my views and interpretation of the 8k filing. The original documents are here . Link to Sunrise Foxhill community website

SRZ: May 8, Compensatory Agreement (Bonus to CEO Mark & CIO Greg Neeb - 2008)

8k Filing by SRZ with regards to compensation.

Mark Ordan (Chief Executive Officer) and Greg Neeb (Chief Investment Officer) have been offered bonus of 475,000 USD and 270,000 USD for the year ending Dec 2008.

Mark's target annual bonus amount was 975,000USD and he was already paid 500,000USD in November when the employment agreement was signed.
The Compensation committee of the Board of directors of SRZ agreed that: Though the company failed to achieve its goals and target for 2008. The market conditions and business environment was extraordinary and Mark has measurably improved the company's prospects. Improvements such as previously announced refinancing, debt restructuring, sale of assets and expense reduction.

Greg Neeb the CIO was also approved a bonus of 270,000USD by the compensation committee.
Greg Neeb's target annual bonus amount was 230,000USD. Mark Ordan recommended Greg's bonus (PN: Bonus more than the target bonus of 230,000USD ) as Greg has made vital contributions to the refinancing, debt restructuring, sale of assets, expense reduction as well as key operational, financial and strategic decisions.

My View: Mark Ordan has made significant improvements in SRZ's health as a viable company (maybe more than what is known publicly and the board acknowledged the same with a bonus) Greg has also been instrumental in getting the things implemented. CIO is Chief Investment Officer but looking at what comments are provided Greg looks like the point man for Mark and his successor. (if and when the question is put forward).

SRZ has now entered a new phase of consolidation the share price is reflecting the same. SRZ still is valued very conservatively and has huge upside potential from these levels (CMP: 2.70) on a medium to long term basis.

PN: These are my personal views. the original 8K filing document is available here

Interest payment on GM bonds till June 30 ,2009

Please remember:
- This is the interest paid to the bond holders in Cash for every 1000 Face Value of Bonds/Debentures till June 30,2009
- the 225 shares for 1000 Face Value of GM Bonds will translate to 2 shares due to 1:100 reverse split and the GM policy of not issuing fractional shares to GM bond holders.
- Ideally you should hold 100,000 Face value bonds to prevent loss of shares due to 1:100 reverse split. Please read my previous post "here" for more details

GM Bonds Exchange Offers & Consent Solicitations

Everybody is well aware of the Global Economic meltdown specially so of the US Auto Industry.

We will try and understand the GM Exchange offer and Consent Solicitations. Here are some of the important points.
1. Public GM Bonds holders who are individuals and institutions have been offered an Exchange of 1,000USD face value bonds with 225 GM shares.
2. These 225 GM shares would then be reverse split into 1:100 ie 2.25 GM Shares.(lets Say New GM shares just so that we can differentiate between the two)
3. GM is not going to issue fractional shares so anybody holding USD 1,000 face value bonds will actually receive only 2 shares (not 2.25 shares) and there will be no compensation for the loss of value for the fractional shares.
4. GM is going to pay interest in cash for the bonds/debentures till June 30,2009
5. Sale of the new GM shares will not result in Taxable income as the shares are part of the settlement/reorganisation hence not taxable.
6. My Calculation is that after the 100:1 reverse split the equity of GM will remain the same around 660 million shares.
7. Successfull exchange will result in atleast reduction in 44 billion reduction in total liabilities from bond holders, US Treasury and VEBA.
8. Current Bond holders will hold 10% of GM after exchange offer.
9. Current GM common stock holders would represent 1% of the new Equity
10. US Treasury and VEBA would hold 89% of new GM Stock
11. Current GM stock holders who may have fractional holdings after the 1:100 reverse split will receive the market price of the GM shares.
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Let us take an example of 100 bonds of BGM (CUSPID: 370-422-725) and see what the end result will be. Is it worth taking the risk of buying these face value USD 25 bonds for 1.60 USD (I have 100 BGM bonds)

100 bonds Cost = 160USD
Face value of 100 Bonds = 100 * 25 = 2500 USD
Interest received by June 30,2009 = 9.22 * 2.5 = USD 23.05 (paid in cash)
So actual Cost of 100 BGM bonds = 160 - 23.05 = 136.95USD
No of New shares = 2
Cost of new shares = 136.95/2 = 68.645USD
So if the new shares trade over 68.645 buying 100 BGM bonds is a good bet.
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the cost will reduce if we consider 100,000 face value bonds (since no loss of fractional shares)
if we consider 4000 BGM bonds (Face value would be 100,000) that would cost 6400USD.
Subtract the interest income (100 * 9.22) USD 922 Input cost will be 5478 USD.
Cost of 225 shares would be 5478 / 225 = 24.34USD
So at a price greater than 24.34 you will be making tax free profits on a short term basis.
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My take:
1. Buying GM bonds is not for the faint of heart..
2. Buy atleast 100,000 Face value bonds to prevent losses due to fractional shares being cancelled by GM
2. Buy bonds/debentures which have a high interest payout by GM (list of interest rates here)
3. Also please read the original Exchange Offer document here. This document mentiones about the tax free status and the fractional share cancellation and a lot more.

Please note: These are my individual views and interpretation of the offer. Please follow the following link to get original offer documents in GM site.