We have a significant amount of relatively short term indebtedness that is in default and we may be unable to satisfy our obligations to pay interest and principal thereon when due.
As of April 14, 2010, we have the following approximate amounts of outstanding short term indebtedness:
(i) JJB has $2.7 million in a secured loan with Chinese Industrial Bank of Commerce bearing interest at 5.3%-9.5% per annum which is due on or before December 31, 2009, which indebtedness is secured by a mortgage on one of the JJB factories in Shangro, China. Radient Pharma has no direct liability related to this debt;
(ii) $83,000 unsecured bridge loan bearing interest at 12% per annum due October 9, 2009 and obligations under a consulting agreement aggregating $144,000 due to Cantone Research, Inc. and Cantone Asset Management, LLC
(iii) Approximately $2.56 million in unsecured convertible notes bearing interest at 10% per annum due September 15, 2010;
(iv) Approximately $3.6 million senior unsecured promissory notes bearing interest at 18% interest, payable quarterly in cash, portions of which principal are due in December 2010 and the balance of the principal is due at varying dates in early 2011;
(v) Approximately $10.4 million represented by a series of 12% Convertible Notes which are due in March and April through 2012;
We are attempting to obtain stockholder approval to restructure and convert a significant portion of the indebtedness referred to in (ii), (iii) and (iv) above; however, there can be no assurance that such indebtedness will be restructured, converted into equity or that the requisite approvals therefor can be obtained. Absent approval of our stockholders and the NYSE Amex to restructure these obligations or the receipt of a new financing or series of financings, our current operations do not generate sufficient cash to pay the interest and principal on these obligations when they become due. Accordingly, there can be no assurance that we will be able to pay these or other obligations which we may incur in the future.
