For putting up $22 mill, PIPE holders functionally have warrants to pick up 14% of this company if the stock price passes 1.85. This will keep a cap on the stock price. In the SEC filing that outlined this PIPE, I could not find that stock price was a trigger for default, but at 1.16, it sure looked like the market was telling you Oclaro was heading for bankruptcy.
The offering will not keep a cap on the stock price. As an investor I'm certainly not concerned about an offering that has a 5 year term to run, if the company does not call the offering in prior to that. I'm primarily concerned with the company returning to profitability, which may occur at some point this year. I think the stock has a solid shot at regaining the $2.00 level this year, and maybe more with some more encouraging news. They will be a major player in carrier expansion.
If OCLR's revenue starts to go up, its stock price will pententrate 1.85. And the PIPE holders would probably give it a push on its way up. The stock price is now at 1.46 with some upward momentum building. IMHO this stock is more likely to go up than down for the next 12 months.