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Dejour Energy Inc. Ltd Ordinary Message Board

  • iamafoolru12smom iamafoolru12smom May 3, 2013 8:41 AM Flag

    We have a working capital deficiency... Ah Duh !!!! Dilution!!!!

    Anyone have any comments about this?

    We have a working capital deficiency and will be required to raise capital through financings. We may not be able to obtain capital or financing on satisfactory terms, or at all.
    As of December 31, 2012, the Company had a working capital deficiency of approximately $8.6 million. Excluding the non-cash warrant liability of $1.4 million related to the fair value of US$ denominated warrants issued in current and previous equity financings and the non-current portion of financial contract liability of $1.3 million, the working capital deficiency mainly consists of $6.0 million outstanding demand line of credit. On March 28, 2013, the Company renewed its revolving bank facility in the amount of $5.9 million. Under the terms of the revised agreement with the Bank, the Company is obligated to make monthly principal payments of $200,000 commencing March 26, 2013 and pay its Bank $1,450,000 on June 30, 2013. We expect to incur general and administration expenses of approximately $2.5 million over the next twelve months. We cannot assure you that debt or equity financing will be available to us, and even if debt or equity financing is available, it may not be on terms acceptable to us. Our inability to access sufficient capital for our operations and our June 30, 2013 Bank payment would have a material adverse effect on our business, financial condition, results of operations and prospects.

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