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Post by wyattdog on Aug 25, 2020 16:30:17 GMT -5
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Post by cjm18 on Aug 25, 2020 18:34:51 GMT -5
So mannkind needs to maintain 40m in the bank to borrow now?
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Post by cedafuntennis on Aug 25, 2020 20:50:52 GMT -5
So mannkind needs to maintain 40m in the bank to borrow now? Not how I read it. If they have $40 M unrestricted cash available, then whatever Afrezza sales they post, even if under the minimum cap, does not constituie a breach of the terms and they can borrow as if they meet the terms. Since they already have that amount and more, this means that even if they will be under in sales due to the China Virus, they can continue to borrow aa needed. This is good in my opinion. |
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Post by mnkdfann on Aug 25, 2020 21:19:50 GMT -5
So mannkind needs to maintain 40m in the bank to borrow now? Not how I read it. If they have $40 M unrestricted cash available, then whatever Afrezza sales they post, even if under the minimum cap, does not constituie a breach of the terms and they can borrow as if they meet the terms. Since they already have that amount and more, this means that even if they will be under in sales due to the China Virus, they can continue to borrow aa needed. This is good in my opinion. For those like myself who are too lazy too look it up right this minute, how much in the way of unrestricted cash does Mannkind have available? |
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Post by brotherm1 on Aug 25, 2020 23:00:48 GMT -5
Not how I read it. If they have $40 M unrestricted cash available, then whatever Afrezza sales they post, even if under the minimum cap, does not constituie a breach of the terms and they can borrow as if they meet the terms. Since they already have that amount and more, this means that even if they will be under in sales due to the China Virus, they can continue to borrow aa needed. This is good in my opinion. For those like myself who are too lazy too look it up right this minute, how much in the way of unrestricted cash does Mannkind have available? They had 63M end of June with $15 million restricted. Unless they’ve been hitting the ATM more since, they should have about $40M max end of this month |
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Post by apidistra on Aug 26, 2020 9:25:25 GMT -5
I read this 8-K to mean that the lender has concluded that his prospects are far far better by not focusing on short term single product targets. How can this be anything but confidence in the future growth of the company?
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Post by cjm18 on Aug 26, 2020 9:38:57 GMT -5
I read this 8-K to mean that the lender has concluded that his prospects are far far better by not focusing on short term single product targets. How can this be anything but confidence in the future growth of the company? Now their focus is on mannkind having enough money in the bank to repay the loAn. That’s all they care about. The agreement wouldn’t have had to be amended if there was confidence of hitting the Afrezza sales goals. |
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Post by sportsrancho on Aug 26, 2020 9:58:22 GMT -5
I read this 8-K to mean that the lender has concluded that his prospects are far far better by not focusing on short term single product targets. How can this be anything but confidence in the future growth of the company? Now their focus is on mannkind having enough money in the bank to repay the loAn. That’s all they care about. The agreement wouldn’t have had to be amended if there was confidence of hitting the Afrezza sales goals. Right and that hamstrings us, they had to know that this was coming. Where is the operating capital going to come from later in the year. |
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Post by golfeveryday on Aug 26, 2020 10:15:26 GMT -5
For those like myself who are too lazy too look it up right this minute, how much in the way of unrestricted cash does Mannkind have available? They had 63M end of June with $15 million restricted. Unless they’ve been hitting the ATM more since, they should have about $40M max end of this month they wouldn’t have agreed to the $40M minimum at this point if they weren’t going to have it. They burn $8-10M per month? So money is coming from somewhere soon. |
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Post by matt on Aug 26, 2020 10:22:45 GMT -5
Not how I read it. If they have $40 M unrestricted cash available, then whatever Afrezza sales they post, even if under the minimum cap, does not constituie a breach of the terms and they can borrow as if they meet the terms. That is not what the amendment says. To fully understand it, you need to go back to the original agreement and the first amended agreement and then finally this second amendment to understand how all of this goes together. In particular, you need to read the definition of default under Section 10 of the original agreement, and the remedies provided to the lender. In short, as with most credit agreements, if a borrower defaults then the lender can declare the loan immediately due and payable together with accrued interest. As a practical matter, most lenders will not declare a borrower in default preferring to squeeze additional payments or concessions out of the borrower because a declaration of default would likely trigger an avalanche of undesirable legal ramifications. These include automatic suspension of the right to raise money under the S-3 registration statement (including the ATM facility) until the next 10-K is filed, and triggering of cross-default provisions which exist in practically every credit agreement (i.e. default on one obligation automatically puts all other obligations in default). Declaration of default by a lender frequently guarantees an immediate filing in bankruptcy court and if that happens everybody becomes a loser, including the lenders, so everybody tends to play nice despite the availability of harsh legal remedies. The amendment grants a waiver of default for failure to reach the required Afrezza minimum sales covenant until November 30, 2020 if the company maintains unrestricted cash of $40 million. That is all the amendment provides; a waiver of the specific financial covenant contained in Section 9.1 in exchange for the higher minimum cash balance. It does not grant a waiver of the minimum sales for the purposes of borrowing additional tranches as that would required a separate amendment to the "Credit Facility Schedule". The scope of the amendment must be read narrowly in accordance with its terms. |
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form 8-k
Aug 26, 2020 10:43:14 GMT -5
via mobile
Post by cjm18 on Aug 26, 2020 10:43:14 GMT -5
Not how I read it. If they have $40 M unrestricted cash available, then whatever Afrezza sales they post, even if under the minimum cap, does not constituie a breach of the terms and they can borrow as if they meet the terms. That is not what the amendment says. To fully understand it, you need to go back to the original agreement and the first amended agreement and then finally this second amendment to understand how all of this goes together. In particular, you need to read the definition of default under Section 10 of the original agreement, and the remedies provided to the lender. In short, as with most credit agreements, if a borrower defaults then the lender can declare the loan immediately due and payable together with accrued interest. As a practical matter, most lenders will not declare a borrower in default preferring to squeeze additional payments or concessions out of the borrower because a declaration of default would likely trigger an avalanche of undesirable legal ramifications. These include automatic suspension of the right to raise money under the S-3 registration statement (including the ATM facility) until the next 10-K is filed, and triggering of cross-default provisions which exist in practically every credit agreement (i.e. default on one obligation automatically puts all other obligations in default). Declaration of default by a lender frequently guarantees an immediate filing in bankruptcy court and if that happens everybody becomes a loser, including the lenders, so everybody tends to play nice despite the availability of harsh legal remedies. The amendment grants a waiver of default for failure to reach the required Afrezza minimum sales covenant until November 30, 2020 if the company maintains unrestricted cash of $40 million. That is all the amendment provides; a waiver of the specific financial covenant contained in Section 9.1 in exchange for the higher minimum cash balance. It does not grant a waiver of the minimum sales for the purposes of borrowing additional tranches as that would required a separate amendment to the "Credit Facility Schedule". The scope of the amendment must be read narrowly in accordance with its terms. Doesn’t seem very helpful to mannkind. |
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Post by peppy on Aug 26, 2020 11:21:10 GMT -5
For those like myself who are too lazy too look it up right this minute, how much in the way of unrestricted cash does Mannkind have available? They had 63M end of June with $15 million restricted. Unless they’ve been hitting the ATM more since, they should have about $40M max end of this monthMNKD has been hitting the ATM? I saw in the difference between real time and summary. Summary should be twice the real time as summary is the buy and the sell. doubling real time has been more than summary. |
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Post by brotherm1 on Aug 26, 2020 14:25:00 GMT -5
Sounds like MNKD will need to get more cash somehow before November 30 ?
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Post by casualinvestor on Aug 26, 2020 15:03:50 GMT -5
They had 63M end of June with $15 million restricted. Unless they’ve been hitting the ATM more since, they should have about $40M max end of this month they wouldn’t have agreed to the $40M minimum at this point if they weren’t going to have it. They burn $8-10M per month? So money is coming from somewhere soon. My recollection of cash burn is quite a bit lower than that since COVID started. 8-10M was last year, and IIRC $5M from the covid loan was going to add about a month of cash. They may be spending more now though Despite that, why is MNKD reserving $40M in cash for a $15M loan? Did they take the second tranche? |
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Post by agedhippie on Aug 26, 2020 16:28:38 GMT -5
... The amendment grants a waiver of default for failure to reach the required Afrezza minimum sales covenant until November 30, 2020 if the company maintains unrestricted cash of $40 million. That is all the amendment provides; a waiver of the specific financial covenant contained in Section 9.1 in exchange for the higher minimum cash balance. It does not grant a waiver of the minimum sales for the purposes of borrowing additional tranches as that would required a separate amendment to the "Credit Facility Schedule". The scope of the amendment must be read narrowly in accordance with its terms. Doesn’t seem very helpful to mannkind. It is helpful because Mannkind was going to breach the revenue target this month. This gives Mannkind some breathing room to get the revenue up by the end on November. |
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