Kash Sethi: Yes, so the show was a success for us. We showcased our GM 4500, a lot of our customers and our vehicle partners. That show is excellent not just to meet truck fleets but also to meet vehicle builders, second stage vehicle builders, people putting box trucks, work trucks and buses on top of platforms, so we were able to show our product to fleets and to our vehicle partners, chassis up in the air, they could see the neatly packaged Proterra batteries. It was a success. Specific to that bus you’re talking about, that is built by a bus company, not by Ford itself. The underlying platform seems to be a Class 2 Ford E-transit cutaway product, but I don’t believe it was a certified roadworthy product, seems to be an early stage prototype.
As you hinted, it is a lower payload, a lower range version – I think the battery size is 67 kilowatt hours, and we’ve got almost twice as much and we have a lot more payload, so. I think if that product hits the road, it will be a very different application – you are carrying eight or nine kids for 40 miles, versus we’re in the 16 to 20 kids over 100 miles, so. It’s good to see more people enter the market, it proves that we are in the right space, electric school bus is worth focusing on, but I believe it’s a very different product that you’re talking about.
Timothy Reeser: I think also important to note, because it’s not a Class 2–or because it is a Class 2, it’s not a Class 4, the incentive offerings are very, very different for that product than they are for ours, and that again is part of the reason we’ve stepped up into the Class 4 product.
Mike Shlisky: Okay, great. That’s great color. I’ll pass it along, thank you.
Timothy Reeser: Thank you Mike.
Operator: Thank you. Our next question comes from the line of Sherif El Sabbahy with Bank of America. Please proceed with your question.
Sherif El Sabbahy: Hi, good morning. I just wanted to ask a bit more on the inventory wind down. You said you expected that to help your cash burn somewhat, but do you foresee customers potentially not wanting some of those older platforms, just given some the headwinds with Romeo or some of those headlines, and if so, do you expect to see any potential inventory write-downs from those units that have been produced but not sold?
Timothy Reeser: At this point, the units that have been produced and not sold today are our Class 3 product, not our Romeo-based product, so they are Proterras, and we do expect to sell those. We don’t expect to write those down on inventory. We do know customers want them, so we’re not worried about the product, and it’s been a very, very good product for us. Again, our focus is moving up a level just because of the higher grant money, but there’s still state money for specifically HFIP and State of Colorado and New York money as well for the Class 3s, so we do expect to continue on that. With the Romeo-based products, at this point we’re working on how to convert all those customers to running GM, so we’ll see where that plays off in terms of inventory write-down, etc.
Sherif El Sabbahy: And then are you able to give us what backlog stood at on a dollar and unit basis at the end of the year?
David Agatston: Yes, we’ve stopped reporting backlog, Sherif. We just–at the moment, because of some of these transitions, we don’t feel it’s as meaningful as we would like it to be as an indicator for the business, so we have a bunch of these Romeo Ford products sitting in backlog that we’re trying to convert into GM products and so we just felt like at this time, it wasn’t meaningful to provide that as an indicator for the business.
Sherif El Sabbahy: Understood. Just one last one, you mentioned you have several quarters, or enough cash to fund the next several quarters and expect to raise capital in the first half. Should we expect the capital raise in the first half to be dilutive to equity, as we’ve seen with some of these share raises?
David Agatston: We would expect that to be via equity, yes.
Sherif El Sabbahy: Got it, thank you.
Operator: Thank you. Our next question comes from the line of Abhi Sinha with Northland Securities. Please proceed with your question.
Abhi Sinha: Yes, hi. Thanks for taking my question, and I apologize in advance – I dropped out of the call for some reason twice, so maybe the questions that I’ll ask might have been already asked, so. The first thing, I want to understand what options and how much time do you have to answer the de-listing, or ?
David Agatston: We had six months, so we have through June of this year to address and get back into compliance.
Abhi Sinha: Okay, and how do you try–in terms of options you have, is the reverse split an option? I’m just trying to understand what options do you guys have in terms of trying to–
David Agatston: fortunately if–you know, the business conditions could change and the stock could increase, but certainly a reverse split is one of the obvious options.
Abhi Sinha: Sure, and in terms of percentage of orders that you were able to convert from Romeo to Proterra, can you–I know complete all of them, but what percentage should we think that we should be able to safely assume that will be converted?
Kash Sethi: It’s hard to say if there’s a number that’s safe to assume, but we–I’m hoping more than 75%.
Abhi Sinha: Sure, perfect. Last one, if you could just elaborate more on the difference in operating and financial aspects when you compare and contrast the two batteries, from Romeo to Proterra, I mean, in terms of what benefits you’re getting in the operating and the financial aspects?
Timothy Reeser: Yes, obviously multiple ones, and we’ve been running Proterra batteries now for a year and five months on the road, in other words, and validating and testing them for a year before that, so we have a lot of experience at this point with the Proterra batteries. The biggest thing is, frankly, reliability and consistency, and that’s why we standardized on them over a year ago rather than Romeo, because they were a higher quality battery, more consistent manufacturing. Historically, they have been less expensive as well, so obviously that has been a benefit on the other side, and I think our relationship with Proterra has been deep and we’ve found them from an engineering standpoint to be a capable engineered product that we work with. In the end, with batteries you look at reliability, safety and cost, and Proterra certainly has consistently won on all three of those by a long shot versus Romeo, and that’s why we switched over a year ago.
Abhi Sinha: Got it. Thank you. That’s all I have.
Operator: Thank you. Ladies and gentlemen, as a reminder, if you’d like to join the question queue, please press star, one on your telephone keypad. Our next question comes from the line of Michael Ward with The Benchmark Company. Please proceed with your question.
Michael Ward: Thanks, good morning everyone. I wonder if I could just clarify the order production-slash-revenue process. There were 130 units produced in Q4 but only roughly 30 got counted as revenue – is that correct?
David Agatston: Correct.
Michael Ward: Okay. Were those units produced to a customer order?
Timothy Reeser: Some were, so to the case o the complexity of this, some were produced to a customer order that had Romeo batteries, so those are being rebuilt, re-allocated for those customers that are now willing, as Kash said, the three-quarters of them we expect are willing to switch to a GM-based product with Proterra batteries, so some were that. Others of them were built either speculatively or for customers who in the end delayed getting their financing, so a combination of all three scenarios.
