Question · Q1 2021
Craig Wolf, a Private Investor, inquired about the company's contingency plans for a worst-case scenario involving a loan covenant breach, the expected timing for delayed backlog projects to resume, and the revenue-generating progress of the recent partnerships with Mitsubishi and LG.
Answer
CFO Richard Mushrush stated that if a covenant breach occurred, the company would explore alternatives with its lender, Heritage Bank, such as a factoring arrangement or adjusting the credit facility, while being cautious of shareholder dilution from other financing options. CEO Jason Tienor addressed the backlog, explaining that while quoting volume is at record levels, a definitive timeline is difficult as they rely on channel partners for information. Regarding the new partnerships, he clarified that revenue from such integrations typically materializes within 6 to 12 months, following the standard commercial project development cycle, and noted that Trane acts as a key distributor for the Mitsubishi integration.