Secure Point Technologies Inc (fka IMSCQ)

[Doctor Detroit]

Mr. Bolduc's Challenge

Assume $50 million in sales at a 40% margin, that would leave $20 million in gross margin. SG&A and R&D at 2014 levels were $16.2 million, which would leave $3.8 million for debt service. $60 million in debt with interest at 15% ($9 million), which, if they apply the $3.8 million to debt, leaves $5.2 million in unpaid interest. Even if they were to refinance at a 10% rate, they would still fall short.

So, any refinancing package needs allow them to defer some interest payments for at least one year. That's a tough deal to find. At this point, a buyout around $2.50 to $3.00 (fully diluted) seems to be the most logical choice in my mind.