Want to see CVM full AI Analyst Report?
Cel-Sci (CVM) Risk Analysis
Risk Overview Q2, 2022
Source: the company's latest filing for the period ended Jun 30, 2022, filed Aug 12, 2022
Risk Change Over Time
No filing history is available.
- Share Price & Shareholder Rights - Risk 1Future equity offerings or other equity issuances may result in dilution to existing shareholders.
CEL-SCI expects that significant additional capital will be needed in the future to continue its planned operations. To raise additional capital, CEL-SCI may in the future offer additional shares of its common stock or other securities convertible into or exchangeable for its common stock. To the extent CEL-SCI raises additional capital by issuing equity securities, CEL-SCI’s stockholders may experience substantial dilution and new investors could gain rights superior to existing stockholders.
- Share Price & Shareholder Rights - Risk 2The exercise of outstanding warrants and options will cause dilution.
As of September 30, 2021, there were outstanding warrants which allow the holders to purchase 1,621,667 shares of common stock, with a weighted average exercise price of $4.88 per share, and outstanding options which allow the holders to purchase up to 11,049,709 shares of common stock, with a weighted average exercise price of $10.08 per share. The exercise of these outstanding warrants and options will cause dilution to holders of our common stock.
- Accounting & Financial Operations - Risk 3CEL-SCI has identified conditions and events that raise substantial doubt about its ability to continue as a going concern for more than twelve months from the date of these financial statements, however, this concern has been alleviated by management’s plans.
Primarily as a result of CEL-SCI’s losses incurred to date, CEL-SCI’s expected continued future losses, and the uncertainties associated with obtaining regulatory approval and ultimately commercializing its products, management has identified conditions and events that raise substantial doubt about CEL-SCI’s ability to continue as a going concern. Management has evaluated the significance of those conditions and has concluded that because there is more than enough cash on hand to meet the Company’s budgeted cash requirements, the substantial doubt about the Company’s ability to continue as a going concern for more than twelve months from the date of these financial statements has been alleviated.
Risk Highlights Q2, 2022
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 39
- Share Price & Shareholder Rights - Risk 1Under CEL-SCI’s amended bylaws, stockholders that initiate certain proceedings may be obligated to reimburse CEL-SCI and its officers and directors for all fees, costs and expenses incurred in connection with such proceedings if the claim proves unsuccessful.
On February 18, 2015, CEL-SCI adopted new bylaws which include a fee-shifting provision in Article X for stockholder claims. Article X provides that in the event any stockholder initiates or asserts a claim against CEL-SCI, or any of its officers or directors, including any derivative claim or claim purportedly filed on CEL-SCI’s behalf, and the stockholder does not obtain a judgment on the merits that substantially achieves, in substance and amount, the full remedy sought, then the stockholder will be obligated to reimburse CEL-SCI and any of its officers or directors named in the action, for all fees, costs and expenses of every kind and description that CEL-SCI or its officers or directors may incur in connection with the claim. In adopting Article X, it is the intent that: · all actions, including federal securities law claims, would be subject to Article X; · the phrase “a judgment on the merits” means the determination by a court of competent jurisdiction on the matters submitted to the court; · the phrase “substantially achieves, in both substance and amount” means the plaintiffs in the action would be awarded at least 90% of the relief sought; · only persons who were stockholders at the time an action was brought would be subject to Article X; and · only the directors or officers named in the action would be allowed to recover. The fee-shifting provision contained in Article X of the bylaws is not limited to specific types of actions, but is rather potentially applicable to the fullest extent permitted by law. Fee-shifting bylaws are relatively new and untested. The case law and potential legislative action on fee-shifting bylaws are evolving and there exists considerable uncertainty regarding the validity of, and potential judicial and legislative responses to, such bylaws. For example, it is unclear whether the ability to invoke the fee-shifting bylaw in connection with claims under the federal securities laws would be pre-empted by federal law. Similarly, it is unclear how courts might apply the standard that a claiming stockholder must obtain a judgment that substantially achieves, in substance and amount, the full remedy sought. The application of the fee-shifting bylaw in connection with such claims, if any, will depend in part on future developments of the law. CEL-SCI cannot assure its shareholders that CEL-SCI will or will not invoke the fee-shifting bylaw in any particular dispute. In addition, given the unsettled state of the law related to fee-shifting bylaws, such as CEL-SCI’s, CEL-SCI may incur significant additional costs associated with resolving disputes with respect to such bylaw, which could adversely affect CEL-SCI’s business and financial condition. If a stockholder that brings any such claim, suit, action or proceeding is unable to obtain the required judgment, the attorneys’ fees and other litigation expenses that might be shifted to a claiming stockholder are potentially significant. This fee-shifting bylaw may therefore dissuade or discourage stockholders and their attorneys from initiating lawsuits or claims against CEL-SCI or its directors and officers. In addition, it may impact the fees, contingency or otherwise, required by potential plaintiffs’ attorneys to represent the stockholders or otherwise discourage plaintiffs’ attorneys from representing the stockholders at all. As a result, this bylaw may limit the ability of stockholders to alter CEL-SCI’s management and direction, particularly through litigation or the threat of litigation.
- Share Price & Shareholder Rights - Risk 2The provision of the amended bylaws requiring exclusive venue in the U.S. District Court for Delaware for certain types of lawsuits may have the effect of discouraging lawsuits against CEL-SCI and its directors and officers.
Article X of CEL-SCI’s amended bylaws provides that stockholder claims brought against CEL-SCI, or its officers or directors, including any derivative claim or claim purportedly filed on its behalf, must be brought in the U.S. District Court for the district of Delaware and that with respect to any such claim, the laws of Delaware will apply. The exclusive forum provision may limit a stockholder’s ability to bring a claim in a judicial forum the stockholder finds favorable for disputes with CEL-SCI or its directors or officers, and may have the effect of discouraging lawsuits with respect to claims that may benefit CEL-SCI or its stockholders.
- Share Price & Shareholder Rights - Risk 3A provision in our Bylaws regarding shareholder claims may not be enforceable.
Article X of our bylaws provides that stockholder claims brought against us, or our officers or directors, including any derivative claim or claim purportedly filed on our behalf, must be brought in the U.S. District Court for the district of Delaware. Although it is our intent that this provision applies to actions arising under the Securities Act of 1933 and the Securities Exchange Act of 1934 there is uncertainty as to whether a court would enforce this provision since Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations under the Securities Act. In addition, since this provision in our bylaws applies to state law claims there is uncertainty as to whether any court would enforce this provision.
- Share Price & Shareholder Rights - Risk 4Future equity offerings or other equity issuances may result in dilution to existing shareholders.
CEL-SCI expects that significant additional capital will be needed in the future to continue its planned operations. To raise additional capital, CEL-SCI may in the future offer additional shares of its common stock or other securities convertible into or exchangeable for its common stock. To the extent CEL-SCI raises additional capital by issuing equity securities, CEL-SCI’s stockholders may experience substantial dilution and new investors could gain rights superior to existing stockholders.
- Share Price & Shareholder Rights - Risk 5The exercise of outstanding warrants and options will cause dilution.
As of September 30, 2021, there were outstanding warrants which allow the holders to purchase 1,621,667 shares of common stock, with a weighted average exercise price of $4.88 per share, and outstanding options which allow the holders to purchase up to 11,049,709 shares of common stock, with a weighted average exercise price of $10.08 per share. The exercise of these outstanding warrants and options will cause dilution to holders of our common stock.
- Share Price & Shareholder Rights - Risk 6The price of CEL-SCI’s common stock has been volatile and is likely to continue to be volatile, which could result in substantial losses for CEL-SCI’s shareholders.
CEL-SCI’s stock price has been, and is likely to continue to be, volatile. As a result of this volatility, CEL-SCI’s shareholders may not be able to sell their shares at or above its current market price. The market price for CEL-SCI’s common stock may be influenced by many factors, including: · actual or anticipated fluctuations in CEL-SCI’s financial condition and operating results; · actual or anticipated changes in CEL-SCI’s growth rate relative to competitors; · competition from existing products or new products or product candidates that may emerge; · development of new technologies that may make CEL-SCI’s technology less attractive; · changes in physician, hospital or healthcare provider practices that may make CEL-SCI’s product candidates less useful; · announcements by CEL-SCI, its partners or competitors of significant acquisitions, strategic partnerships, joint ventures, collaborations or capital commitments; · developments or disputes concerning patent applications, issued patents or other proprietary rights; · the recruitment or departure of key personnel; · failure to meet or exceed financial estimates and projections of the investment community; · actual or anticipated changes in estimates as to financial results, development timelines or recommendations by securities analysts; · variations in its financial results or those of companies that are perceived to be similar to CEL-SCI; · changes to coverage and reimbursement levels by commercial third-party payors and government payors, including Medicare, and any announcements relating to reimbursement levels; · general economic, industry and market conditions; and · the other factors described in this “Risk Factors” section.
See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.