Question-and-Answer Session
Operator
(Operator instructions) Our first question comes from the line of Todd Cooper with Stephens Incorporated, go ahead.
Todd Cooper - Stephens Inc.
Yes, thank you. Rich can you tell us about Silver Lake Sumeru and their experience in the power supply industry given the Board representation they’ll have?
Richard Thompson
Okay Todd, how are you doing?
Todd Cooper - Stephens Inc.
I’m good.
Richard Thompson
Silver Lake is the most; I guess the largest and the most renowned firm in mid-cap technology. They have direct experience in the component level businesses and they do have experience, although they haven’t invested in our power supply business as they know the industry well.
Todd Cooper - Stephens Inc.
Okay and did I understand that the new investment, potentially dilutive to existing shareholders by no more than 19.9%?
Linda Heller
Todd, its Linda, they have voting rights up to 19.9%. The actual dilution to the shareholders will depend on a number of factors, including things such as share price, ultimate resolution of why they would convert or redeem and as well if the company repurchases any additional bonds of the 8%.
Todd Cooper - Stephens Inc.
So that 19.9% is just voting rights?
Linda Heller
Yes, it is.
Todd Cooper - Stephens Inc.
Okay and are there any other covenants remaining other than the one you mentioned the minimum cash balance?
Linda Heller
We do have some limitations on additional debt in liens, but they are much less restrictive than they were before the amendment. The financial debt covenant has been removed, however.
Todd Cooper - Stephens Inc.
Okay and the tangible net worth covenant will be been removed.
Linda Heller
Has been removed, will be removed.
Todd Cooper - Stephens Inc.
Okay and can you say what you’re paying to repurchase the $21.75 million of outstanding bonds?
Linda Heller
We’ll be purchasing them at a 30% discount.
Todd Cooper - Stephens Inc.
Okay and one last one, if I may and I’ll let someone else. Rich, can you give us an idea of your priorities regarding the restructuring and additional cost savings initiatives that you’ve talked about?
Richard Thompson
Well, obviously Todd we’re going to continue to invest heavily in renewable energy, both in the global sales footprint and expanding our surface capabilities. We currently have over 50 engineers working on new products for the renewable energy marketplace, both PV, wind and accessories. So we’re interested in accelerating that spending as the market recovers in renewable energy.
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