Yet another “Cash for Clunkers” program

Following in the footsteps of Xiotech and Pillar Data, Overland Storage is the latest company to offer cash for old storage systems. The name for their program is “Cash For Junkers“, and they are offering up to $7000 in discounts when trading in old storage systems for Overland’s NEO E-Series tape libraries or up to $500 when purchasing Snap Server rack-mountable NAS models.

I hope this strategy works out for them; they just reported a loss of $2.7 million over the last quarter, and sent out a press release earlier this week to tell the world they have received a deficiency letter from NASDAQ:

[…] on September 15, 2009 it received a Nasdaq Staff Deficiency Letter (the “Nasdaq Letter”) indicating that, for the last 30 consecutive trading days, the company’s common stock has not maintained the minimum market value of publicly held shares (“MVPHS”) of $15,000,000 as required for continued inclusion by Listing Rule 5450(b)(2)(C) or 5450(b)(3)(C). The Nasdaq Letter has no effect on the listing of the company’s common stock on the NASDAQ Global Market at this time. The company will be provided 90 calendar days, or until December 14, 2009, to regain compliance. To regain compliance, the MVPHS of the company’s common stock must be $15,000,000 or more for 10 consecutive trading days no later than December 14, 2009.

The press release appears to be missing from their website; it received an earlier deficiency letter on October 1, 2008 about the price of their shares. These had fallen below the $1.00 mark; the company is planning to do a reverse stock split later this year if the trading price of their shares stays below this value, but fixing the total market value of the company will be a lot harder.

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