Good posts Civi, Pen, Bean, JJ -

Once the arbitration happens, the loan plus whatever interest is negotiated can be paid off easily with award proceeds. But, lenders typically want some sort of guarantee of payback, along with some interest while they wait. Being a pinkie stock does not help in a lender's eyes.

Thinking one way the company can receive financing is to find a high-risk lender willing to do some sort of Buffet'esque financing as done with GE, GS, and recently BAC, that includes high interest, preferred shares, and possibly future convertible options. The preferred shares would put the lender at the front of the line in case of, well, we'll not go there. Dilution has been argued against and claimed to not be part of the loan equation, so convertibles may not be in the mix. But, not so sure how else the company can guarantee things without income or giving up some skin in the game.

High-risk for the lender always equates to high reward. So, then there is that pesky monthly/quarterly/annual interest. Without company income, that is a really tough sell. Speaking of selling, the other half of the equipment will bring in about 17M, so interest on this new loan would have to be in the nieghborhood of less than 16-17% (assuming the previous equipment sale money has not been squandered) to get the company through the next couple of years of interest payment. Then there are any years beyond two, not to mention employee salaries.

This is a tough one.