How do you know they have been holding them since August? The filings will tell us how many new shares have been issued to Golden State. But the filings are late! Golden State had around 18,300 warrants remaining as of June 30, 2016.
9% Promissory note due November 2016
On April 26, 2016 the Company signed a 9% Promissory Note with Golden State Equity Investors, Inc. (“Golden State”) in the amount of $40,000. Interest is due monthly in the amount of $300. Golden State advanced the $40,000 on the note and on June 16, 2016 applied $14,659 to fund the exercise of warrants under the terms of the 4.75% Convertible debenture (described below) held by Golden State, leaving $25,341 outstanding on the 9% Promissory note.
4.75% Convertible Debenture due December 31, 2016
On November 3, 2006, the Company issued to Golden State a 4.75% convertible debenture in a principal amount of $100,000, due December 31, 2014, subsequently extended to December 31, 2016 and warrants to buy 28,571 shares of the common stock at an exercise price of $381.50 per share. In connection with each conversion, Golden State is expected to simultaneously exercise a percentage of warrants equal to the percentage of the principal being converted. During the six months ended June 30, 2016, Golden State converted $270 of the $100,000 debenture into 92,809,800 shares of common stock and exercised warrants to purchase 77 shares of common stock at $381.50 per share based on the formula in the convertible debenture. Additionally Golden State advanced $14,716 against future exercises of warrants of which $14,771 was applied to the exercise of warrants leaving $-0- of unapplied advances at June 30, 2016.
The conversion price for the 4.75% $100,000 convertible debenture is the lesser of (i) $4.00 or (ii) 80% of the average of the five lowest volume weighted average prices (“VWAP”) during the twenty (20) trading days prior to the conversion. If Golden State elects to convert a portion of the debenture and, on the day that the election is made, the volume weighted average pre-split price is below $0.70, the Company shall have the right to prepay that portion of the debenture that Golden State elected to convert, plus any accrued and unpaid interest, at 135% of such amount.
We expect to fund the ongoing operations through the existing financing in place (see below); through raising additional funds as permitted by the terms of Golden State financing as well as reducing our monthly expenses.
Our ability to fund the operations of the Company is highly dependent on the underlying stock price of the Company.
4.75% Convertible Debenture due December 31, 2016
On November 3, 2006, the Company issued to Golden State a 4.75% convertible debenture in a principal amount of $100,000, due December 2016 as a result of a maturity extension agreement received by the Company in March 2015, and warrants to buy 25,571 shares of the common stock at an exercise price of $381.50 per share. In connection with each conversion, Golden State is expected to simultaneously exercise a percentage of warrants equal to the percentage of the principal being converted. During the six months ended June 30, 2016, Golden State converted $270 of the $100,000 debenture into 92,809,800 shares of common stock and exercised warrants to purchase 77 shares of common stock at $381.50 per share based on the formula in the convertible debenture. Additionally Golden State advanced $14,716 against future exercises of warrants of which $14,771 was applied to the exercise of warrants leaving $-0- of unapplied advances at June 30, 2016.
9% Promissory note due November 2016
On April 26, 2016 the Company signed a 9% Promissory Note with Golden State Equity Investors, Inc. (“Golden State”) in the amount of $40,000. Interest is due monthly in the amount of $300. Golden State advance the $40,000 on the note and on June 16, 2016 applied $14,659 to fund the exercise of warrants under the terms of the 4.75% Convertible debenture (described above) held by Golden State, leaving $25,341 outstanding on the 9% Promissory note.
