From 10-Q - Note that the closing conditions set forth for a successful consummation of the share purchase create quite a high bar for Sphere to jump over.. we will know in a few months!
"Management has projected that cash on hand will not be sufficient to allow the Company to continue operations if the Company is unable to negotiate a resolution of its defaults. Even if the Company is able to successfully resolve its existing defaults, there can be no guarantee that the Company will be able to otherwise remain in compliance with its obligations under such facilities or to amend or refinance these facilities prior to their November 19, 2018 maturity dates, or to raise the funding required to do so, whether through the Share Purchase described below or otherwise.
"If the Company is able to resolve its existing defaults, management projects that cash on hand will not be sufficient to continue operations through the end of the third quarter of 2018 if the Company is otherwise unable to further amend, refinance, or pay off its debt and credit facilities.
"If the Share Purchase is consummated, the Company expects that the proceeds to be received by the Company would be sufficient to pay off its outstanding debt and credit facilities. However, the consummation of the Share Purchase remains subject to certain closing conditions contained in the Purchase Agreement (including Purchaser’s receipt of adequate funding to close the Share Purchase, which it has not yet secured) and there can be no guarantee that the Company will be able to raise additional funds or amend or refinance our debt and credit facilities on favorable terms or at all, nor can there be any guarantee that the Share Purchase will ultimately be consummated.
"Significant changes from the Company’s current forecasts, including but not limited to: (i) any delay in the closing of the Share Purchase described below promptly and in any event before its debt with Colbeck, FBC Holdings and/or MF Ventures, LLC becomes due (including as a result of the failure of the Purchaser to obtain funding adequate to pay the Purchase Price, or the failure to satisfy certain closing conditions), (ii) failure to comply with the financial or other covenants in its credit facilities; (iii) shortfalls from projected sales levels; (iv) unexpected increases in product costs; (v) increases in operating costs; (vi) changes in the historical timing of collecting accounts receivable; and (vii) inability to maintain compliance with the requirements of the NASDAQ Capital Market and/or inability to maintain listing with the NASDAQ Capital Market could have a material adverse impact on the Company’s ability to access the level of funding necessary to continue its operations at current levels.
If any of these events occurs or the Company is unable to generate sufficient cash from operations or financing sources, the Company may be forced to liquidate assets where possible and/or curtail, suspend or cease planned programs or operations generally or seek bankruptcy protection or be subject to an involuntary bankruptcy petition, any of, which would have a material adverse effect on the Company’s business, results of operations, financial position and liquidity.
"The Company incurred losses from operations and negative cash flows from operating activities for the six months ended June 30, 2018 , and such losses might continue for the foreseeable future. Based upon the Company's current expectations and projections for the next year, the Company believes that, even if it is able to resolve its existing defaults under its debt and credit facilities, it may not have sufficient liquidity necessary to sustain operations through the end of the third quarter of 2018. These factors, among others, raise substantial doubt that the Company will be able to continue as a going concern .
AI
