Just a bit confused about the last 10-Q where it says:
"During the third quarter of 2013, the Company negotiated a LPA with Southridge, Partners II, L.P. (“Southridge”). The LPA...allows the exchange of claims, securities, or property for stock when the arrangement is approved for fairness by a court proceeding. The process, approved by the court in August 2013, has the potential to eliminate nearly $2.1 million of our financial obligations ...accrued expenses and other current liabilities, and notes payable. The process began with the issuance in September 2013 of 1,618,235 shares of the Company’s common stock to ASC Recap. During September and October 2013, ASC Recap sold the Company’s common stock and during the three months ended March 31, 2014 paid creditors approximately $80,000 from the proceeds and retained a service fee of approximately $27,000."
Now I need a little clarification here. ASC gets 1.6 million shares, sells them for SIX CENTS a share, deducts their TWENTY FIVE PER CENT "fee," and then pays the creditor -- who is supposedly the chairman of the board -- what's left? Is that about right?
Why? Why not just give the COB the 1.6 million shares directly? Or even just do a secondary and pay him off? What "service" is ASC providing that merits a TWENTY FIVE PER CENT fee?
