Zeev, I would think the street would expect there would be some additional financing necessary to bridge them through the period until they begin receiving revenues. As noted earlier, there are a large number of unexercised warrants, and the $7.5M credit available from Carl Berg. If Carl is satisfied that they are only awaiting action from the OEMs, then it is in his interest (as a 12.7% shareholder) to keep them solvent by waiving any conditions that might have originally been written into the loan.
It was also my understanding that the burn rate was going to drop soon, since most of it went towards capital equipment which has now been received and installed.
Clearly their financial situation is highly fluid, with the rampup to production, and only the company really knows the current status.
BTW, in your comment to Wexler regarding the financing from Castle Creek, you didn't state it exactly correctly: to be precise, they completely waived the conditions on the first tranche, thereby agreeing to a fixed conversion rate, and then issued a second tranche with a similar 6-month fuse.
As an aside, would you be able to clarify my earlier question regarding SEC rules on changes in beneficial ownership? Would CC, as a beneficial owner of more than 5%, be required to report short sales to the SEC as a 'change in beneficial ownership?' Thanks in advance.
Rich |
