Q. What is an Equity Line FacilitySM and when should I execute...

Q. What is an Equity Line FacilitySM and when should I execute one?

A. An Equity Line FacilitySM is the issuance of slightly discounted common stock in exchange for cash consideration, which allows a company to "draw down" capital over a fixed period of time. The benefit to the company is that it solely retains the right to choose the timing and amount it wishes to draw down, and therefore the level and pace of equity dilution, based on a contractual pre-determined formula. This structure is perfect for shares that are in an up-trend. In times when management considers itself "undervalued", they may choose not to draw down in order to prevent unnecessary dilution at what they perceive as a depressed price.