Hey viTRifY - I reallly do need to clarify this as this one is very important to any holder or investor to understand.the warrant liability should be seen as part of the overall debt (it was actually reclassified out of the loan liability in the prior year).
SPA still has to repay the debt - either through cash settlement or issuance of shares - at the option of Pure…we don’t know the terms, but the fact it’s in the fin. instruments disclosure as a fin. liability simply reinforces my view on this.the FV measurement and general recognition I have major question marks over. Without knowing terms this is impossible to fully judge, however let’s be realistic on this give the poor and inadequate disclosure in general. Right now, assume zero chance of Pure taking up the option. We also don’t know if this will be part of any forced repayment or renegotiation under the covenants (again, due to a lack of insight/disclosure to properly assess), but should assume it is to be conservative and given all other facts we have at hand. Net is, unless there is solid evidence to the contrary (and I’d love for SPA to come out and tell me I’m wrong, and why), this needs to be looked at for what it is - part of the 5M+ obligation.
we can see how much has been repaid (not much) + interest from the financials as mentioned in a different post. The interest expense of >1M also doesn’t reconcile with a 9% rate…more like 20%. Cash does not actually cover it + assume they need 1-2M minimum for working cap needs. The loan is a huge one to sort out in the coming months
I wouldn’t normally focus in on something like this (the borrowings and cash flow management), however this is the type and size of item that is of such critical importance to the future of this company that to stay silent was not an option for me. good luck all, we’re going to need plenty of it
