AI
| Followers | 376 |
| Posts | 17197 |
| Boards Moderated | 3 |
| Alias Born | 03/07/2014 |
Saturday, January 03, 2015 8:56:38 AM
NO. "Based on the latest 10-Q issued for Sept 30 $OCAT had $7.8 mil cash and cash equivalents"
Cash on hand and cash equivalents is NOT anything remotely the same as shareholder equity. Shareholder equity is an entirely separate entry on a balance sheet.
Shareholder equity = assets - total liabilities
It's called SHAREHOLDER EQUITY by the NASDAQ ( and not cash on hand or cash and cash equivalents) for a reason. It's what the public SHAREHOLDERS have as "value", what they have in "share value" if the company were to liquidate and pay all liabilities using all cash on hand and other assets. It's the "balance" of the balance sheet. If SHAREHOLDER EQUITY is negative, as it's been in all recent yrs past for OCAT, then the shareholder really have nothing of value, especially in a liquidation event.
This is biz accounting 101
From the prospectus, PAGE S-15:
http://www.sec.gov/Archives/edgar/data/1140098/000104746914009660/a2222363z424b5.htm
It is CRYSTAL CLEAR from that accounting BALANCE SHEET, in thee latest filed PROSPECTUS, that OCAT DOES NOT meet the minimum NASDAQ shareholder-equity requirements of $4 million.
The ONLY way to do that, to INCREASE ONE's SHAREHOLDER EQUITY is given by the fundamental accounting equation again:
SHAREHOLDER EQUITY = ASSETS - LIABILITIES
Thus the only way to increase SHAREHOLDER EQUITY is ONLY TWO options, either INCREASE ASSETS (cash) or pay down LIABILITIES. PERIOD.
1) Pay down debt/liabilities
2) Or increase cash on hand, aka a large secondary offering or a large Lincoln financing that would need to exceed about $3.2 million, as that's how much they're short.
It's clear to me they are/were banking on the secondary offering placing and selling which instantly boosts that cash line entry way, way up and then shareholder equity is instantly way past the $4 million required.
I believe that was/is their plan, but the secondary has not sold at a value they are happy with (probably steep discount by underwriters due to the stock's weakness, current low shareprice and low demand, requiring a stiffer than normal share discount to the underwriters. However, even at $4.50 or something a share, it easily makes them enough cash to clear the $4 million shareholder equity requirement and gets them on the NASDAQ. That's the pickle they're in IMO)
Thus, OCAT DOES NOT presently meet the $4 MILLION minimum SHAREHOLDER EQUITY (NOT cash and cash equivalents) as required by the NASDAQ CAPITAL MARKETS. As I've said all along and just proven using their own balance sheet entries from their own duly filed SEC documents.
Cash on hand and cash equivalents is NOT anything remotely the same as shareholder equity. Shareholder equity is an entirely separate entry on a balance sheet.
Shareholder equity = assets - total liabilities
It's called SHAREHOLDER EQUITY by the NASDAQ ( and not cash on hand or cash and cash equivalents) for a reason. It's what the public SHAREHOLDERS have as "value", what they have in "share value" if the company were to liquidate and pay all liabilities using all cash on hand and other assets. It's the "balance" of the balance sheet. If SHAREHOLDER EQUITY is negative, as it's been in all recent yrs past for OCAT, then the shareholder really have nothing of value, especially in a liquidation event.
This is biz accounting 101
From the prospectus, PAGE S-15:
http://www.sec.gov/Archives/edgar/data/1140098/000104746914009660/a2222363z424b5.htm
It is CRYSTAL CLEAR from that accounting BALANCE SHEET, in thee latest filed PROSPECTUS, that OCAT DOES NOT meet the minimum NASDAQ shareholder-equity requirements of $4 million.
The ONLY way to do that, to INCREASE ONE's SHAREHOLDER EQUITY is given by the fundamental accounting equation again:
SHAREHOLDER EQUITY = ASSETS - LIABILITIES
Thus the only way to increase SHAREHOLDER EQUITY is ONLY TWO options, either INCREASE ASSETS (cash) or pay down LIABILITIES. PERIOD.
1) Pay down debt/liabilities
2) Or increase cash on hand, aka a large secondary offering or a large Lincoln financing that would need to exceed about $3.2 million, as that's how much they're short.
It's clear to me they are/were banking on the secondary offering placing and selling which instantly boosts that cash line entry way, way up and then shareholder equity is instantly way past the $4 million required.
I believe that was/is their plan, but the secondary has not sold at a value they are happy with (probably steep discount by underwriters due to the stock's weakness, current low shareprice and low demand, requiring a stiffer than normal share discount to the underwriters. However, even at $4.50 or something a share, it easily makes them enough cash to clear the $4 million shareholder equity requirement and gets them on the NASDAQ. That's the pickle they're in IMO)
Thus, OCAT DOES NOT presently meet the $4 MILLION minimum SHAREHOLDER EQUITY (NOT cash and cash equivalents) as required by the NASDAQ CAPITAL MARKETS. As I've said all along and just proven using their own balance sheet entries from their own duly filed SEC documents.
Join the InvestorsHub Community
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
