Three possible scenarios IMO....
(1) The total of three restaurants help severely slow down cash burn or eliminate it entirely. The 10Q says they have all of their cash needs for the next 12 months and the drunken rumblings at the Hollywood Grand Opening party also say this. In addition, they would have to cut back on expenses -- perhaps certain key employees will no longer be needed such as one such lady I met who I believe referred herself as uWink's "designer" of the inside. I'm with you, however, I highly doubt the 3 restaurants will make them break-even on ANY metric. Only thing we can realistically hope for is that the cash burn is severely descreased, but that will only buy them time.
(2) The licensing sales are NOT capital intensive. That's the nature of licensing & royalty deals once they are signed -- the margins are enormous and the capital needed is minimally. Despite all I've heard on that and the huge optimism communicated from management on this, I'm even more skeptical but hopeful which is why I haven't reloaded yet but I continue to watch in case I want to reload. The price alone is getting me closer to taking a small speculative gambling position, bracing myself for disappointment.
(3) If #1 & #2 fail to materialize soon, they'll have to do a capital raising. However, being debt-free this time around and no plans to open new restaurants, the amount of capital being raised would be less than last time. But with a severely depressed stock price it may be just as dilutive. If #1 & #2 fail, #3 won't matter anyway....they'll either have to go under or dilute shareholders to the same effect so the terms don't even really matter IMO. It would just be life support.
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