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KiOR down to its last funding hope, shares -35% AH

  • KiOR (KIOR) -35% AH after saying in its 10-K filing that it received an investment commitment of up to $25M from Vinod Khosla, conditioned on the achievement of certain performance milestones, but it would be unable to fund its operations and meet its obligations if a deal is not finalized by April 1.
  • KiOR also says the SEC served a subpoena seeking documents about the progress at its Columbus, Miss., facility and the timing of projected biofuel production levels.
Comments (7)
  • N808
    , contributor
    Comments (39) | Send Message
     
    Anybody know what performance milestones are referred to?
    17 Mar, 07:25 PM Reply Like
  • Adrian Manaila
    , contributor
    Comments (32) | Send Message
     
    This is only a small part, it is more of this horror story in the filing:
    "We must raise capital in one or more external equity and/or debt financings to fund the cash requirements of our ongoing operations, including the optimization projects and upgrades we have begun at our Columbus facility, and to restart our Columbus facility. Other than the Commitment from Mr. Khosla to invest in us a cash amount of up to an aggregate of $25,000,000 in available funds in a number of monthly borrowings of no more than $5,000,000 per month, we have no other near-term sources of financing. Because the Commitment is subject to the negotiation and execution of definitive financing documents and the achievement of performance milestones, we cannot be certain as to the ultimate timing or terms of this investment. There is no assurance that we will be able to successfully secure such additional financing and if we are unable to do so, we do not expect to find other sources of near term financing. Even if we are able to secure the funds under the Commitment or any additional financing, any investment may require significant changes to our current business structure, including, but not limited to: a change in the focus of our business; suspension of some or all of our operations; delaying or scaling back our business plan, including our research and development programs; reductions in headcount, overhead and other operating costs; and the longer-term or permanent closing of our Columbus facility, each of which would have a material adverse effect on our business, prospects and financial condition. As discussed in further detail below, our private placements with Khosla and Gates involve two tranches and the second tranche is our only other committed source of financing. The commitment by Gates to close a second tranche will terminate on June 30, 2014 and we do not expect to be able to satisfy the closing conditions for that tranche in time to meet the deadline. Any funds from the second tranche of the Khosla private placement is unlikely to come in the near term because in order to close such second tranche we must, among other things, raise $400 million. The lack of any additional committed sources of financing raises substantial doubt about our ability to continue as a going concern. In addition, we will need to obtain consents from the current holders of our outstanding debt in order to obtain additional financing. Such consent may be withheld at the discretion of these third parties. We require substantial additional capital to meet our ongoing overhead and other operating costs, particularly as we continue to seek to optimize our Columbus commercial production facility, meet our debt service obligations and pay other costs, including payments due at maturity of our borrowings. In addition, we will require substantial additional capital to design, engineer and construct additional commercial production facilities. The extent of our need for additional capital will depend on many factors, including the amounts necessary to restart and bring the Columbus facility to steady-state operations, whether our current optimization efforts are successful, the funds necessary to cover the front-end capital expenditures for and the construction of our planned commercial scale production facility; and the funds necessary to meet any related equity contribution requirements or debt service obligations; whether we succeed in producing cellulosic gasoline and diesel at commercial scale and the timing thereof; our ability to control costs, the progress and scope of our research and development projects; the effect of any acquisitions of other businesses or technologies that we may make in the future; and the filing, prosecution and enforcement of patent claims."
    17 Mar, 08:08 PM Reply Like
  • jim139220
    , contributor
    Comments (4) | Send Message
     
    I don't think so although credit Suisse maintained its $3 target price on the stock
    17 Mar, 08:52 PM Reply Like
  • Gary Jakacky
    , contributor
    Comments (2391) | Send Message
     
    Sounds like the Obama administration would be interested.
    17 Mar, 08:22 PM Reply Like
  • SoldHigh
    , contributor
    Comments (995) | Send Message
     
    So iow, bk by 4-1?
    17 Mar, 11:54 PM Reply Like
  • Sidi Carnot
    , contributor
    Comments (13) | Send Message
     
    This is not and never was a viable business. It is a corpse and it is starting to smell really bad. I predicted that this would happen. Show me one bulk biofuels business that has delivered. Not one. All the dreams of $1 gallon gasoline/ diesel/ jet fuel go up in a puff of hot air, each and every time. Do your homework and read up on the energy return on energy invested, and the thermodynamics. There is no magic bullet and no low cost feedstock that can compete any time soon with conventional fossil fuels. We cannot replicate what nature has done over millions of years and produce transport fuels with a magic process or magic catalyst.
    Advice. If you do not understand chemistry or thermodynamics and you invest in this claptrap do not be disappointed when it fails. You will earn more money betting on horses.
    Who am I . I am a petroleum chemist that analyses claptrap like this and I would never invest my or the company I work for monies in pie in the sky drivel like this.
    20 Mar, 09:37 AM Reply Like
  • N808
    , contributor
    Comments (39) | Send Message
     
    Then why do they continue to invest in this?
    1 Apr, 11:02 AM Reply Like
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