Astra failed to meet the minimum cash reserve requirements linked to a $12.5 million note issuance to High Trail Capital. The company was required to maintain a cash balance of at least $15.0 million but later faced an adjusted requirement of at least $10.5 million in unrestricted, unencumbered cash. Astra is now in default and owes $8 million on the principal investment. The company is currently in discussions with other investors but warns that there is no assurance of timely or successful transactions. Astra shares were little changed in after-hours trading.
While the company is “in continued discussions with a number of other investors,” it warned it “can provide no assurance that it will be able to consummate any additional transaction in a timely manner, or at all.”
Shares of Astra were little changed in after hours trading from their close of about 92 cents a share.
Astra had previously performed a reverse stock split in September to avoid a Nasdaq delisting. The company had cut 25% of its workforce in August to shift its focus from rocket development to spacecraft engine production.
The debt raise first required that Astra have “at least $15.0 million of cash and cash equivalents” on hand. That liquidity requirement was adjusted after Astra failed to prove compliance a first time, to require “at least $10.5 million of unrestricted, unencumbered cash and cash equivalents.”
Astra is expected to report its third-quarter results on November 13.