O.K., let's assume CYOE is going to be able to get the $10M debt financing from "someone". Of course, interest and fees will be taken out up front, so lets assume they start with $9m in cash (if they are lucky).
With that $9m, they can ALMOST pay their accounts payable balance of
$10,186,000. No, they won't even begin to dent their accumulated deficit of $107,705,000. Just last quarter they added $4,194,000 to their accumulated deficit, and that was with a "huge" equipment sale to Cresent Communications thru Comdisco.
Their gross profit margin this quarter was about 20%. At that rate, they need to sell $1 billion in equipment just to pay off their deficit. And that is ignoring SG&A costs that most certainly would go up as well.
Folks, these guys just aren't showing a plan to survive. Even they indicate in their 10-Q that this financing, if real, will only carry them to March of 1999. Then they will either need to obtain more debt or equity (read dilution) financing. Who in their right mind would lend this company money?
And who, in their right mind, would put their hard earned money into this company's stock?
I don't care if they sign a $20m dollar contract tommorrow, it just isn't going to be enough. Don't let this company take any more of your money!
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