Cardica, Inc. has a market cap of $48.14 million; its shares were traded at around $2.01 with and P/S ratio of 4.87. CRDC is in the portfolios of PRIMECAP Management, PRIMECAP Management, Jim Simons of Renaissance Technologies LLC, Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:On September 30, 2009, institutional and individual investors, including existing stockholders, purchased approximately $10.2 million of the Company's common stock and warrants to purchase the Company's common stock in a private placement. The net proceeds were approximately $9.9 million after offering expenses. Under the terms of the purchase agreement with these investors, the Company sold 8,142,082 units at a purchase price of $1.2525 per unit, with each unit consisting of one share of common stock and one warrant to purchase 0.50 of a share of common stock, or warrants to purchase an aggregate of 4,071,046 shares of the Company's common stock. The warrants became exercisable on April 1, 2010 at an exercise price of$1.45 per share and will expire on September 30, 2014.
The expected term of options granted is determined using the “simplified” method. Under this approach, the expected term is presumed to be the mid-point between the vesting date and the end of the contractual term. The risk-free interest rate for the expected term of each option is based on a risk-free zero-coupon spot interest rate at the time of grant. The Company recognizes the stock compensation expense for option awards using the accelerated method over the requisite service period of the award, which generally equals the vesting period of each grant. The Company has never declared or paid any cash dividends and does not presently plan to pay cash dividends in the foreseeable future. The Company estimates forfeitures in calculating the expense related to stock-based compensation. The Company recorded fair value-based stock-based compensation expenses under ASC 718 of $211,000 or $0.01 per share, and $366,000 or $0.02 per share, for the three months ended March 31, 2010 and 2009, respectively and $974,000, or $0.05 per share, and $1.4 million, or $0.09 per share, for the nine months ended March 31, 2010 and 2009, respectively. Total compensation expense related to unvested awards not yet recognized is approximately $1.1 million at March 31, 2010 and is expected to be recognized over a weighted average period of 2.7 years.
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