The money will keep the optical components and subsystems supplier going while Enablence negotiates the terms of several secured notes worth $11 million, the company stated late Wednesday.
It also hinted at improved finances on the back of a revenue increase. A month ago, Enablence stated it had only $900,000 on hand and was at risk of insolvency if it could not raise sufficient capital.
On Wednesday, Enablence stated note holders have agreed to hold off on collecting on the overdue notes during this renegotiation period, and the company further intends to raise financing to develop its products. Details of the future financing were not disclosed, except to say that the money could come from strategic or financial investors.
Enablence further plans to sell its Swiss photodiode business, although it did not say how far along the sale is at this point.
The company's chair stated the company gave uninterrupted service to its customers and that revenues are increasing.
"Thanks to the continued support of our Tier 1 customers and key suppliers, we have been able to operate normally through the month of June. We expect to report an increase of over 30 per cent in revenues for the June quarter as compared to the March quarter," stated Peter Dey, chair of Enablence.
"Furthermore, our joint venture company, Sunblence Technologies, has begun shipping its first commercial splitter products and is aggressively ramping up capacity to meet anticipated growth in local access markets."
Mr. Dey said more details would be forthcoming in year-end results.
Enablence warned of cash woes in late June at the same time that its CEO, Tim Thorsteinson, left the company. One possibility it raised at the time was a review of strategic alternatives, a phrase commonly used when a company is considering a sale.
The firm's third-quarter results reported a net loss from continuing operations of $9.1 million, including an impairment charge of $5.7 million. Revenues fell 66 per cent to $2.8 million "due generally to a general market slowdown." Net income was $1.4 million, due to the sale of its Teledata business.
Enablence has struggled financially in recent quarters, taking measures such as selling inventory and reducing staff. After its underperforming systems division ate half of the company's cash reserves in four months, Enablence sold that as well.
The firm is based in Toronto and has a presence in Ottawa.