Ultra Motorcycle Company (fka UMCC)

[MMMARY]

smartestone: FINOVA loan

Finova is in bankruptcy. They filed in March. The loan amount is $4.5M. The company currently has negative net worth. Liabilities exceed assets by over $lM. Ultra did not have the cash to make a loan payment. If they don't have the money to pay a $l00K or so loan payment, how can they pay their other bills and stay in business? No one would extend this loan. Their only chance is if someone buys the loan for pennies on the dollar and extends it for Ultra with no payments. Even then, can Ultra be profitable enough to pay it off eventually? I personally don't think so and this is why.

Ultras superior competitor Titan just filed for chapter 7. They had the same problem Ultra has. Their COG is 82%. They almost lose money by building motorcycles. It is very difficult for small start up motorcycle companies to profitably build motorcycles. BIGX and AFV had the same problems. They also went chapter 7.

The big issues right now. They have no cash and are in default on a $4.5M loan. They are also currently not cash profitable. I personally don't see much of a future. We shall see. Hopefully they will release some news this week about their progress with finova.