Liquidity and Continued Listing Requirements | 3 Months Ended |
|---|---|
Sep. 30, 2011 | |
| Liquidity and Continued Listing Requirements [Abstract] | |
| Liquidity and Continued Listing Requirements |
Note 2 – Liquidity and Continued Listing Requirements We have reported cash and cash equivalents and short-term investments of $119.9 million as of September 30, 2011. We reported operating losses from continuing operations of $51.1 million and $9.8 million, for the three months ended September 30, 2011 and 2010, respectively, while reporting a decrease in cash and cash equivalents and short-term investments of $10.8 million for the three months ended September 30, 2011 and an increase of $1.4 million for the three months ended September 30, 2010. The Company is subject to risks common in the high technology and emerging energy industries including increased competition, reduced selling prices for solar energy, continued ability to research and develop our products and manufacturing technologies and reliance on government regulations to provide incentives for alternative energy solutions, including our products, as well as risks associated with the economies in our target markets. The Company is continuing to take actions to better align operating expenses to near-term revenue expectations and believes that cash, cash equivalents and short-term investments will be sufficient to meet our liquidity needs for current operations and planned capital expenditures. See Note 13, “Restructuring Charges,” for information regarding these restructuring activities. Although we are not currently experiencing significant liquidity constraints, we believe that a successful repositioning of our United Solar Ovonic business will require additional investment and refinancing or restructuring of our outstanding Convertible Senior Notes (“Notes”). We are considering a range of strategies to attract additional needed investment. These strategies may include additional asset sales, technology license agreements, joint venture arrangements, renegotiating existing obligations or other transactions. The Company’s outstanding Notes do not come due until June 15, 2013. The Company may consider various financing or refinancing options for the Notes before June 15, 2013. If these options are not successful, there is no assurance that sufficient cash will be generated from operations to enable the Company to repay this debt when it comes due. In connection with the foregoing, we have begun discussions with representatives of an informal group of noteholders regarding our repositioning efforts and to explore the group’s interest in restructuring our obligations under the Notes. Our discussions are at a preliminary stage. If we are unable to reach an accord with the noteholders or execute sufficiently on one or more of the strategies that we are considering to attract required investment, results of operations, financial condition and cash flows could be materially adversely affected and we may choose to seek reorganization under the U.S. Bankruptcy Code. Our common stock is currently listed for trading on the NASDAQ Global Select Market. The continued listing of our common stock is subject to the satisfaction of certain ongoing conditions pertaining to our financial performance and marketability of our stock. On September 15, 2011, we received a deficiency letter from The NASDAQ Stock Market notifying the Company that it no longer meets NASDAQ’s requirements for continued listing on the NASDAQ Global Select Market because the minimum bid price of the Company’s common stock has not equaled or exceeded $1.00 at least once over a period of 30 consecutive trading days. The letter does not impact the Company’s listing on the NASDAQ Global Select Market at this time and the Company’s common stock will continue to trade on the NASDAQ Global Select Market under the symbol “ENER.” NASDAQ explained in the letter that the Company will be afforded 180 calendar days, or until March 13, 2012, to regain compliance with NASDAQ’s Bid Price Rule. To regain compliance, the closing bid price of the Company’s common stock must meet or exceed $1.00 per share for at least 10 consecutive business days. If the Company does not regain compliance by March 13, 2012, NASDAQ will provide written notification to the Company that the Company’s common stock will be subject to delisting from the NASDAQ Global Select Market. The Company may, however, be eligible for an additional grace period if it satisfies the continued listing requirement for market value of publicly held shares and all other initial listing standards (with the exception of the Bid Price Rule) for listing on the NASDAQ Capital Market, and submits a timely notification to NASDAQ to transfer the listing of our common stock to the NASDAQ Capital Market. The Company may also appeal NASDAQ’s delisting determination to a NASDAQ Hearings Panel. We intend to actively monitor the bid price of our common stock and will consider available options to resolve the deficiency and regain compliance with the NASDAQ requirements. Such actions could include implementation of a reverse split of the Company’s common stock, which would need to be authorized by the Company’s stockholders, or other possible actions. However, the Company has not yet determined what action to pursue to ensure compliance with NASDAQ’s continued listing requirements, and there can be no assurance the Company will be able to regain compliance with NASDAQ’s continued listing requirements or successfully transition to the NASDAQ Capital Market. If our common stock ceases to be listed on the NASDAQ Global Select Market and is not listed on another U.S. national securities exchange, such event would constitute a fundamental change under the terms of our Notes. In the event of such a fundamental change, the holders of the Notes would have the right to require us to repurchase their Notes within 35 days, which would have a material adverse effect on our liquidity. There is no assurance that additional sources of liquidity to repay the Notes can be obtained on terms acceptable to the Company, or at all. If we were unable to repurchase Notes under such circumstances, we would be in default under our indenture. |