This ongoing meme (which has become a mimeomeme over time) of how the stock has been destroyed by the derivatives kind of confuses me. Tivus lined up several angel investors to begin operations because at the time the company started up there was NO WAY any bank or "traditional" financing source was going to lend money, given the state of the markets at that time (and most of that money is still sitting on the sidelines to this day). How else were they supposed to line up funding? I can assure you that it's not as easy as it sounds, having been involved on the committee that lined up funding during my airline's bankruptcy, and with the knowledge that most pinkies out there would kill to be able to attract even that kind of funding in the first place.
Using derivatives -- which of course have to convert at some time or another -- Tivus has been able to avoid taking on onerous long-term debt, though they're definitely a liability on the books right now. I'd rather take the haircut up front with these derivatives than a continuing series of even sharper haircuts over the life of the company. If what Tivus is doing on the installs pays off -- and it looks right now like it will -- then R3's guesstimate of a buck/share in the fall seems pretty realistic, if not a touch too pessimistic, actually.
AI
