E-commerce services provider Beyond.com (Nasdaq: BYND) rocketed up 23 percent Tuesday morning after announcing it has received up to $40 million in private equity funding.
That jump left its shares at just 0.81, not quite enough to keep them from being delisted from the Nasdaq if things don't improve. Shares have been trading under $1.00 since October 12; if a stock stays below $1 for too long, the Nasdaq may delist it.
"This is phase one of our financing plan," said CFO Curtis Cluff in a company statement. "Used judiciously in combination with other planned financing, this facility will bolster our balance sheet as the company works towards its financial goals."
Beyond did not disclose the name of the private investment fund with which it has the agreement. Under the terms of the one-year deal, it can be extended for an additional year at Beyond.com's discretion.
Beyond may obtain as much as $40 million through the issuance of common stock to the fund in a series of drawdowns. The drawdowns are subject to the satisfaction of a number of conditions, including the filing of a registration statement with the Securities and Exchange Commission covering the resale of the shares. Pricing will be based upon the volume weighted average price of the company's stock during the investment period.
The company said this type of financing will allow it to access capital in a series of smaller draws over time, thereby minimizing the dilutive impact on currently outstanding shares.
Earlier this month, Beyond reported a third quarter loss of $9.9 million, or 26 cents per share, excluding amortization. First Call's survey of two analysts predicted a loss of 27 cents per share. Including all charges, Beyond.com lost $39.9 million, or $1.06 per share.
Third quarter revenue of $29.1 million included $25.9 million from eStores and government systems.
Beyond. also moved up its schedule for operating profitability. The company now sees positive earnings before interest, taxes, depreciation and amortization in the first quarter of 2002, three quarters earlier than previously expected.