Applied Solar Inc. has entered into a definitive loan and security agreement with The Quercus Trust, pursuant to which the company borrowed $698,000 under a short-term loan that matures June 15. As a condition to the loan, the company is required to file for reorganization pursuant to Title 11 of the U.S. Bankruptcy Code within 30 days following the date of the loan.
The company says it is currently engaged in discussions with potential financing sources, including The Quercus Trust, concerning the extension of debtor-in-possession financing to support the company's operations during its reorganization.
‘Despite very promising macro and micro business trends affecting the company, including solid relationships with its business partners, the current state of the financial markets – combined with a difficult and complicated capital structure – have made it extremely challenging for the company to secure needed financing,’ states David Field, chief executive officer.
SOURCE: Applied Solar