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1. Sirius XM (NASDAQ:SIRI) closed the day Monday nearly five percent higher amid a big market drop as the XM unit of the merged satellite radio company issued $350 million in senior notes that will come due in 2013. According to a press release the company will use the money to pay down XM's huge debt load.

That takes care of the immediate future for Sirius XM, but the company is far from being in the clear as the auto industry continues to suffer and Sirius XM struggles to hold onto, let alone add, customers.

For the first time ever the company posted a net-loss of subscribers last quarter.

Long term, the SIRI stock is far from a sure thing. The cost of contracts, such as the half a billion dollars shelled out to Howard Stern, weigh heavily on the bottom line, but nothing has hurt the company more than the collapse of the auto industry. There is hope, however, that the new SiriusXM application for the iTouch and the iPhone will offset some of the recent customer losses, but the jury is still out on that one.

I believe that the content that SatRad offers is better than any other alternative out there and that the company will ultimately continue to attract new subscribers, but I also have doubts that SiriusXM can survive if the costs of content continues to be so high.

Additionally, Sirius can't afford to dish out another $500 million to Stern when his contract expires in a couple of years and if he does not remain, his followers could very well rid themselves of the SatRad service.

Short term, I can see the iPhone hype pushing this stock to near, if not over, a dollar but until investors see some real synergy savings from the merger and an increase in customer base, SIRI is a pretty risky play.

I'll continue to hold onto some long shares for the next few quarters, but I'll be selling my trading shares on any significant spike towards a dollar.


2. Epicept (EPCT): Although Epicept announced a stock offering last week that sent shares of EPCT to nearly seventy cents after previously approaching a dollar, the stock held up well on Monday while trading on nearly three times its daily volume.

At first glance the timing of the stock offering would indicate that an announcement of a much-anticipated partner for Ceplene is not close, otherwise the company could have released that news and then announced a stock offering for a higher price.

It's yet to be seen whether a European partnership will materialize or not, but the offering does allow Epicept to move forward with Ceplene's named patient program in addition to covering costs incurred while filing for approval in the US and Canada.

EPCT is still a bargain while trading below a dollar, in my opinion, because even if Ceplene fails to take off, any positive news regarding Azixa, a treatment for metastatic brain cancer partnered with Myriad, could significantly spike the share price of the stock.

3. Oncothyreon (ONTY): Shares of Oncothyreon soared 30% Monday on news that Merck KGaA will test the company's cancer vaccine, Stimuvax, against breast cancer in a Phase III trial. Stimuvax is also being tested in the treatment of lung cancer in a Phase III trial.

If Stimuvax continues to prove effective in training a patient's immune system to attack cancerous cells and thereby prolonging the life of the patient, three dollars will be looked upon as a steal for the ONTY stock.

I'm still continuing my accumulation of this stock that could very well be the next Dendreon (NASDAQ:DNDN)

As always, it should be noted that the benefit that the cancer vaccine can potentially provide a cancer patient far outweighs the potential financial gains for investors.

Disclosure: VFC is long ONTY, long SIRI and long EPCT.

Source: 3 Small Cap Stocks That Held Up in a Down Day