Michael, re. <<in fact they may already be out of money.>>
I doubt it.
My calculation of running out in mid December assumed they held their cash burn rate at the same level as in the September quarter.
However, a cash-starved company can reduce its cash burn rate by, among other things, stretching out its accounts payable (i.e., stiffing the vendors longer). Considering that they have not announced any financing yet, I would assume they are just taking temporary measures like this to reduce cash burn. You might be surprised at how much extra time a company can get this way.
<<I have a gut feeling that Crane couldn't even get off-shore financing,>>
I'm sure he could.
Offshore funds who make deals similar to Panda's last financing are interested primarily in three things:
* stock price
* volume
* market cap.
In other words, liquidity, liquidity, and liquidity. That's what they need to get their money back out of the stock in a timely fashion after they buy some convertible instruments. What the company does, and who the CEO is, make little difference, except in determining the discount and such things.
Panda's stock price, volume and market cap are all still sufficient for getting discounted convert deals. Since this is a last-resort measure, and it is still available to Panda, you can be sure the co. will continue to operate for at least another 6 mos., unless Crane did something incredibly stupid and failing to keep his business running. Considering that Crane drove his previous business into bankruptcy, it could happen again. But with a stock price north of $3, he can definitely raise cash if he just says yes. |
